used vehicles Pakistan

The government has abolished the Personal Baggage Scheme for used vehicle imports after approval from the Economic Coordination Committee (ECC) and the federal cabinet, Commerce Minister Jam Kamal Khan told the National Assembly on Wednesday. The government has retained the Gift and Transfer of Residence schemes but introduced stricter conditions to prevent their use for commercial purposes. The changes were announced during the National Assembly’s Question Hour in response to questions from MNA Dr Shazia Sobia, who sought details about the decision to abolish the Personal Baggage Scheme and changes made to Pakistan’s used vehicle import policy. Stricter Rules For Gift, Transfer Schemes According to a written response from the Ministry of Commerce, vehicles imported under the remaining Gift and Transfer of Residence schemes must now comply with minimum safety, environmental and regulatory standards applicable to commercial imports of used vehicles. The government has also increased the interval for importing vehicles under these schemes from two years to three years. In addition, vehicles imported through the schemes will remain non-transferable for one year. The changes are aimed at ensuring that vehicle import schemes are used by genuine beneficiaries rather than for commercial trading. The ministry said the revised policy was developed following consultations with relevant stakeholders, including the Ministry of Overseas Pakistanis and Human Resource Development. Overseas Pakistanis Face New Stay Requirements The government has also increased the minimum stay-abroad requirement for beneficiaries of the schemes. Under the revised rules, applicants must have stayed abroad for at least three years, with a minimum of 850 cumulative days of stay. The requirement is applicable across the retained vehicle import schemes. Another condition has also been modified regarding the country from which a vehicle can be imported. The requirement that a vehicle must be imported from the same country where the sender resides will now apply only to the Transfer of Residence Scheme. The government has introduced these conditions to prevent individuals from using vehicle import schemes for purposes other than genuine personal use. Govt Targets Commercial Misuse The Commerce Ministry said the vehicle import schemes were originally introduced to facilitate overseas Pakistanis who wanted to bring vehicles into Pakistan for their personal use. However, authorities identified widespread misuse, particularly under the Personal Baggage Scheme. The scheme was allegedly being used for commercial purposes rather than genuine personal vehicle imports. The government subsequently amended the vehicle import policy through SRO 61(I)/2026 dated January 15, 2026. The abolition of the Personal Baggage Scheme represents the latest step in the government’s efforts to restrict the commercial exploitation of vehicle import concessions. The ministry said the revised framework was intended to ensure that the benefits of the schemes reached only bona fide beneficiaries. Vehicle Imports Could Decline The Ministry of Commerce said it was too early to determine the full impact of the revised policy on Pakistan’s overall vehicle imports. However, it acknowledged that vehicle imports could decline following the abolition of the Personal Baggage Scheme and the introduction of stricter requirements for the Gift and Transfer of Residence schemes. The impact will depend on how overseas Pakistanis respond to the revised requirements and how many potential importers continue to qualify under the remaining schemes. The changes could also affect the used vehicle market by reducing the number of vehicles entering Pakistan through personal import channels. No Duty-Free Vehicle Imports In Pakistan Separately, Finance Minister Muhammad Aurangzeb clarified that there is no provision allowing duty- and tax-free imports of cars or other vehicles anywhere in Pakistan. The finance minister provided the clarification in a written response to a question submitted by MNA Moin Aamer Pirzada. The question sought to establish whether any region of Pakistan allowed the import of vehicles without payment of applicable duties and taxes. Aurangzeb said there was no such provision, reinforcing the government’s position that vehicle imports remain subject to the applicable duties and taxes. The clarification is significant because discussions around special concessions and vehicle import schemes have often raised questions about whether certain regions or categories of importers receive exemptions from normal taxation. Policy Focuses On Genuine Personal Use The latest changes mark a significant tightening of Pakistan’s used vehicle import framework. By removing the Personal Baggage Scheme and imposing additional requirements on the remaining schemes, the government is seeking to distinguish genuine personal imports from commercial activity. For overseas Pakistanis, the new three-year interval, 850-day stay requirement and one-year non-transferability condition could make the import process more restrictive. At the same time, the government says the retained schemes will continue to facilitate overseas Pakistanis who meet the requirements and genuinely want to import vehicles for personal use. The policy could also reduce opportunities for businesses or individuals that previously relied on personal import schemes to bring used vehicles into Pakistan for resale.