Punjab Increased Registration Fees for Cars and Bikes

Punjab Increased Registration Fees for Cars and Bikes

It has been over a week since the fiscal budget 2024-25 was announced, and its effects are still reverberating in the local car market. Previously, we reported that there would be no rise in the General Sales Tax (GST). However, the recent development concerns changes in registration fees due to the Punjab provincial budget. These adjustments, set to be enforced from July 1, 2024, mark a departure from the policy of the past 70 years.

For owners of scooters and motorbikes, the registration fee will now be a flat rate of Rs. 1,500, simplifying the process and ensuring uniformity.

also read: Encouraging Development Sales Tax On Locally Manufactured Hybrid Cars Will Remain Unchanged

For those contemplating the sale of their cars, motorbikes, or scooters within the first decade of ownership, it’s essential to note the introduction of a new 10% annual transfer fee. This means an additional yearly charge on top of the standard transfer costs.

Notably, the registration fee for cars will now vary based on their engine capacity. Cars with engines under 1,000cc will have a fixed fee of Rs. 20,000. Vehicles with engines ranging from 1,000cc to 2,000cc will face a registration fee calculated as a percentage (0.02%) of their purchase price. For cars exceeding 2,000cc, the fee will be higher at 0.03% of the purchase price.

The Punjab government aims to modernize the province’s tax framework, with these adjustments forming a part of that initiative. The increased revenue generated from higher fees will be utilized for various development projects across Punjab.

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In another recent update, Finance Minister Muhammad Aurangzeb announced in his National Assembly speech that the reduced sales tax rate will persist for hybrid electric vehicles (HEVs) listed in Schedule 8 and Serial No 73.

This announcement brings relief to local companies, as it means prices for domestic hybrid cars will not surge. Had the government opted for increased GST rates, prices for local HEVs would have seen a significant rise.