The auto industry is one of the fastest-growing industry of Pakistan and vehicle is a necessary need for everyone. The auto industry pays a high revenue to the economy in-form of taxes, duties and other charges. The government generates more revenue from the auto sector to give them more facilities. The low economic activities badly affect the auto sector. Because the devaluation of rupee value against the dollar is a cause of high custom duty charges.
To generate more revenue the government should help the auto sector to grow and fast their production level. If we look at the current situation of our country w see that the auto sector suffers a loss from the last few months. Many of the auto manufacturers even shuttle their production plant for many days in a month. This a worrying sign for the government too because if the sales down then the government can’t collect taxes. The low production and low sales mean the economical activities are slow and not help the auto industry to grow.
Current Situation of Automotive Industry:
As compared to the last year the sale of cars down by 53%. This percentage shows that the economic activities of Pakistan are slow. This is a worrying sign for us because one of the largest tax-paying industry has not improved sale. The sales down is meaning the high prices of cars that are not affordable for everyone. According to the auto manufacturers, they said they have no option because they have to pay a high amount of taxes to a government that is imposed by the government. The inflation rate is very high in Pakistan in this situation people are just trying to fulfill the need and don’t want to buy a luxury car.
Recently the government imposed FED on all vehicles start from 660cc to own word. Automakers increase the prices of all vehicles including motorbikes cars high-end vehicles because they are paying a high tax to the government. The production level is very slow you can say automakers only produce many vehicles every month.
How to improve the Auto Industry Position:
This is the responsibility of the government to help this sector who pay a large amount in the revenue because its beneficial for the government. If the government helps and gives facilities to this sector they increase their production level. All we know that high sales mean high taxes to the government. Auto manufacturers pay a high amount of custom on the import of vehicle parts the government should give them relief in customs duty and low the burden of taxes.
This will help them to produce the vehicle at a low cost and boost their sales. Previously they also pay taxes to the government but these taxes are affordable for them and never increases the cost of production. To facilitate this sector will help to increase the revenue. The low production of the vehicle also increases in the unemployment ratio in Pakistan. As the sale is down and companies have not produced more vehicles in this situation the companies can’t pay salaries on all employees. According to the auto sector details, they said the low sale force us shilling our staff because we can’t pay a salary to everyone.
