The new five-year 26-2021 auto policy was introduced in the federal cabinet in which tax exemption on vehicles up to 850 cc will be abolished, additional customs duty will be abolished, excise duty on locally manufactured vehicles will be abolished and car manufacturers will be given 10% till 2026. Includes export targeting suggestions.
The new auto policy has also proposed to abolish holding tax on small vehicles and also to apply tax exemption on small imported vehicles.
The tax exemption on imported vehicles will be revised every year. Under the new auto policy, it is proposed to give car manufacturers a target of 10% exports by 2026.