The Federal Board of Revenue (FBR) has confirmed that only overseas Pakistanis, including those residing in the UAE and other countries, are eligible to import vehicles under the gift or transfer of residence schemes. The clarification follows media reports suggesting large-scale clearance of luxury cars through under-invoicing.
According to FBR regulations, Pakistani nationals living abroad, including dual nationals, may import old or used vehicles under three schemes: personal baggage, gift scheme, and transfer of residence. However, cars imported under these schemes must not be older than three years, while other vehicle types must not exceed five years. The duty and tax structure remains uniform across all three schemes, although motorcycles and scooters can only be brought in under the transfer of residence scheme.
The eligibility criteria exclude students receiving remittances from Pakistan, non-earning dependents of overseas Pakistanis, and individuals who have imported, gifted, or received a vehicle within the past two years.
To promote eco-friendly transportation, the government grants a 50% exemption on duty and taxes for hybrid electric vehicles (HEVs) up to 1,800cc and a 25% exemption for HEVs between 1,800cc and 2,500cc. An estimated nine million Pakistanis live abroad, forming a significant pool of potential beneficiaries for these schemes.
In its statement, the FBR dismissed claims of under-invoicing and emphasised that Pakistan Customs has expanded its Faceless Customs Assessment (FCA) system — introduced in December 2024 — to streamline trade and reduce direct contact between customs officials and importers. The move aims to curb opportunities for misuse that were possible under the previous system.
Addressing a specific media claim that a 2023 Toyota Land Cruiser was assessed at just Rs 17,635 (AED 229), the FBR clarified that the actual assessed value was Rs 10.05 million (AED 130,000), with Rs 47.2 million (AED 612,000) collected in duties and taxes. The agency stated that all such vehicles have been evaluated under FCA at higher assessed values, ensuring no revenue loss to the government.
The tax authority also rejected allegations of trade-based money laundering in these imports, stressing that only overseas Pakistanis are entitled to bring in vehicles under the schemes, which do not involve any outward remittance of foreign exchange from Pakistan.
Furthermore, the FBR noted that the import of used vehicles under these provisions has been a long-standing practice, predating the FCA system. The clarification, it said, was necessary to counter “misleading narratives” and reaffirm the regulatory framework governing vehicle imports.
