As we told you earlier regarding the imminent increase in car prices after the government imposed 25% GST (general sales tax) on cars with price above Rs. 40 lacs, here we come with an update – Pakistan Suzuki Motor Company (PSMC) has taken the initiative to pass on the impact of the GST hike to its customers, becoming the first company in the market to do so.
The Hike
The company has only increased the price of Swift GLX CVT by Rs. 304,000 from the previous price of Rs. 5,125,000 to the new Rs. 5,429,000. Meanwhile, Pak Suzuki retained the prices of other variants.
The GST Effect
It’s worth noting that the 25% GST already applies to cars with an engine capacity of 1400cc and above. However, the second clause of this SRO is particularly significant. It indicates that all cars priced above Rs. 40 lacs will now carry a 25% sales tax, excluding the sales tax itself from the car’s price.
To clarify this point, a Suzuki official informed PakWheels.com that although some variants of Cultus and Swift are priced over Rs. 4 million, only the Swift GLX falls under this new tax net when excluding sales tax.
Under the new amendments, 25% GST will be implemented on:
- Locally manufactured or assembled vehicles with engine capacity of 1400cc and above.
- Locally manufactured or assembled vehicles if invoice price (excluding sales tax) exceeds Rs. 4 million.
- Locally manufactured or assembled double cabin (4x) pick-up vehicles.
Other cars or specific variants that might fall under this new GST net include Honda City, Toyota Yaris, and Proton Saga. However, confirmation regarding these models will have to wait until the respective companies make official announcements.
What’s your thought pertaining to the effects and prices hikes after government new move? Drop your thoughts in the comments section.
