IMF Approves 5-Year-Old Car Imports from Sept

Islamabad, June 20, 2025 — The International Monetary Fund (IMF) has greenlit a federal government proposal to allow imports of vehicles up to five years old from September 2025, the Ministry of Commerce revealed to the Senate Standing Committee on Finance this week. Initially, these imports face an additional 40% customs duty, reducible by 10% annually from FY26–27, phasing out to standard tariffs only. From FY27, vehicles up to seven years old will be permitted, a major shift from the prior three-year limit. Personal baggage scheme imports dodge the extra duty, requiring a minimum 700-day overseas stay.

This policy, tied to the IMF program’s trade liberalization, aims to expand consumer choice in the automobile sector but risks pushback from local assemblers over competition. The committee rejected Public Finance Management Act (PFMA) amendments from the Finance Ministry, citing governance concerns over idle cash and unutilized profits in public entities. Senator Anusha Rehman demanded Auditor General oversight for all autonomous bodies, prompting a revision to redefine “business entities” as public entities.

The Port Qasim Authority’s refusal to transfer surplus funds to the federal pool drew scrutiny, with the Finance Ministry awaiting a response. The Federal Board of Revenue (FBR) reported customs reforms, cutting duties on 35% of tariff lines, proposing a new 5%, 10%, 15% duty structure (replacing 3%, 11%, 16%), and zero-rating 916 more tariff lines, pushing the total to 3,117, aligning with the National Tariff Policy to lower costs and boost exports.

Web context highlights Pakistan’s trade deficits (e.g., $25 billion, web ID: 0), while X posts show mixed reactions—some welcome choice, others fear local job losses. Critically, the narrative of “liberalization” may mask economic risks—web sources note assembler reliance, and X sentiment suggests distrust in IMF-driven shifts, hinting at potential unrest.