RD Removed on Used Cars Up to 1800cc: Will Prices Drop?

29 Apr 2023

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RD Removed on Used Cars Up to 1800cc: Will Prices Drop?

Removing the Regulatory Duty (RD) on used cars up to 1800cc on March 31, 2023, brought it back to 0% after the government imposed 100% RD on them in August 2022. Although the SRO was initially imposed till February 2022, it was extended till March 31, causing confusion in the market. To clarify the situation, a blog was written, revealing that the Regulatory Duty (RD) on cars above 1800cc remained at 70%, meaning there would be little difference in their prices. However, removing RD on cars up to 1800cc has generated curiosity among people, who wonder if it will significantly decrease their prices. The customers can get detailed information that May Removal of RD on Used Cars Results in reduced prices.

Price Decrease Soon?

Market analysts were asked to understand the situation, and it was discovered that the impact of RD removal may not be significant. This is because between August 2022 and March 2023, the General Sales Tax (GST) increased from 18% to 25%, and the dollar rate jumped from Rs.214.65/USD to Rs.283/USD, resulting in a 30% increase against the PKR. Furthermore, due to the 100% RD, very few people imported or cleared their cars from the port, resulting in a scarcity of used cars on the roads during that period. Therefore, there would be little difference in the current prices and rates before August 22, 2022.

Regulatory Duty (RD) Removal Result?

In conclusion, the prices of used cars up to 1800cc are expected to come down, but the impact of RD removal may not be significant due to the new GST and depreciation of PKR against the USD. The unstable economic conditions in Pakistan will continue to make the situation uncertain and unstable for sellers and buyers.

What do you think about this situation? Share your thoughts in the comments section.

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