How is tax calculated on imported used cars in Pakistan?

Question

I am importing a used car from Japan. How do I calculate the customs duty, sales tax, and withholding tax payable on arrival?

Answer 1

To calculate taxes on an imported used car from Japan:

1. Determine Customs Value based on the FOB (Free on Board) price plus freight and insurance as per Customs Valuation Rulings.

2. Apply Customs Duty rate from the Pakistan Customs Tariff for the car’s engine capacity and type.

3. Calculate Sales Tax at 18% on the customs value plus customs duty.

4. Add Withholding Tax based on engine capacity as per the Income Tax Ordinance.

5. Include any additional levies (FED, port charges, etc.) to get the total payable amount.