The epidemic situation in the country continues to bash the economy, local automakers suffer in brunt arguably borne and in this situation, tax relief is the only way to aid them. They are facing a stiff downturn in the sale in the previous three months.
Local auto manufacturers highlighted this issue that a high amount of taxes reason to increase the prices of vehicles and that are not bearable for consumers. The huge sale decline in July 2019 due to the added of FED tax on all vehicles.
Automakers expected tax relief in FY budget 2020-21, but the hopes were dead after announcing the bill. The government has increased the prices of various vehicles. The Former Chairman of Pakistan Association of Automotive Parts and Accessories Manufacturer’s (PAAPAM) Mr. Mashood Ali Khan stated that the entire automotive industry hoping that the year 2020 becomes profitable for them unfortunately the outbreak of COVID-19 has been quashed their hopes.
Furthermore, he said in this critical situation government should give them relief in tax because its the only way for them to boost sales and manufacturing speed. Automakers are already paying up to 7.5% FED and 7-11% custom duty. The additional added tax creates more difficulties for them.
The reduction in taxes encourages them to gain the production of vehicles and provided relief to customers to boost sales. The decline in the sale of the automotive industry also affects the economy. The industry paid taxes to the government against sales.
They are hoping that sales will be increased after the reduction in taxes and they can grow up vehicle production. The growth in production is highly needed for our country after imposing strict conditions on the import of vehicles.
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