Used car imports in Pakistan are no longer capped at five years old. The Ministry of Commerce has told the Federal Board of Revenue (FBR) that the five-year age limit on commercial imports of used vehicles stands removed with effect from 1 July 2026, in line with an earlier federal cabinet decision. Importers still have to meet environmental and safety standards, but no new maximum age has been set.
The short version
- A commerce ministry office memorandum dated 30 October 2026 confirms the five-year age limit on commercial used-vehicle imports was removed from 1 July 2026.
- It covers cars, buses, goods vehicles and motorcycles under PCT headings 8702, 8703, 8704 and 8711.
- No replacement age limit has been announced; environmental and safety standards still apply.
- An extra duty on these imports, set at 40% in the 2025-26 budget, is scheduled to fall to zero by 2029.
What happened
The five-year limit was due to run until 30 June 2026, but its status after that date was unclear. The FBR asked for clarification in a memorandum dated 23 October, PakWheels reported. The commerce ministry replied on 30 October that the limit had been removed for vehicles imported from 1 July 2026 onwards, under a decision approved by the Economic Coordination Committee and the federal cabinet, according to TechJuice. Imports must still comply with other import-policy requirements and with standards set by the Ministry of Industries and Production and the Engineering Development Board.
The step was part of a roadmap Finance Minister Muhammad Aurangzeb set out in June 2025. He told a Senate committee then that the age limit would be lifted entirely from 1 July 2026, in line with an IMF condition and a tariff strategy to phase out over-protected sectors, Dawn reported. The same plan put a 40% regulatory duty on commercial used-vehicle imports, on top of normal duties and taxes, to be cut step by step.
The extra duty on used-vehicle imports is set to fall to zero by 2029
Regulatory duty on commercial used-vehicle imports, % (planned schedule announced June 2025)
Why it matters
Removing the age cap widens the pool of vehicles that commercial importers can bring in. Older used cars cost less abroad, so even with the extra duty, some could undercut locally assembled models on price. Demand was already rising under the five-year rule: 2,276 used vehicles were imported in September, compared with 48 in May, according to government sources cited by TechJuice. Knock-On reported that jump earlier this month, when carmakers said they wanted the door shut. The decision also arrives while the government’s draft auto policy proposes lower car tariffs and new export targets for assemblers.
The knock-on effects
First order: more choice for used car imports in Pakistan
Importers can now source vehicles of any age, provided they meet safety and environmental standards. That opens up cheaper stock that was previously ruled out.
Second order: pricing pressure on local assemblers
Locally assembled cars compete with imports on price. As the extra duty steps down each year, that competition is likely to grow, at a time when auto sector profits were already expected to fall this quarter.
Third order: the import bill and customs revenue
More vehicle imports mean more dollars spent abroad, but also more customs revenue while the extra duty lasts. How the balance falls depends on volumes, which the government has not forecast.
Who could benefit
- Commercial importers and dealers: a wider range of stock they can legally bring in.
- Price-sensitive car buyers: older imported vehicles may come in below local prices.
- Customs revenue: the regulatory duty applies on top of normal duties while it is phased out.
Who may face pressure
- Local car assemblers and parts makers: more competition from imported used vehicles.
- Owners of locally made used cars: resale values could soften if imports grow.
- The import bill: more vehicle imports add to dollar demand.
What to watch
- FBR instructions to customs: how the memo is applied at ports.
- Monthly used-vehicle import data: whether volumes rise beyond September’s 2,276.
- Auto policy tax measures: ARY News reported, citing official documents, that a mini-budget with new vehicle levies is likely.
- Industry response: any reaction from local assemblers.
Sources
- PakWheels, Govt Removes 5-Year Age Limit on Used Car Imports, 30 October 2026
- TechJuice, Government Removes 5-Year Age Limit on Used Car Imports, 30 October 2026
- ARY News, Pakistan lifts restriction on importing used cars over five years old, 30 October 2026
- Samaa, Pakistan removes five-year age limit on commercial imports of used vehicles, 30 October 2026
- Dawn, Budget 2025-26: Roadmap for liberalised vehicle imports unveiled, 21 June 2025
This is analysis, not investment advice. Figures are as of 30 October 2026.
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