How vehicle token tax works in Pakistan
Token tax is an annual road tax collected by each province's Excise & Taxation Department. Paying it certifies that your vehicle is legally allowed on public roads for the financial year, which runs from 1 July to 30 June. Once paid, a token sticker or digital record is issued, and traffic police can stop and fine any vehicle that does not display a valid token.
Your total is usually made up of two parts: the token tax (MVT) itself, which depends on engine capacity, vehicle value or a flat slab, and the withholding tax under the Income Tax Ordinance, which is where being an FBR filer saves you the most money.
Punjab
Punjab has moved to a value‑based system for cars above 1000cc — roughly 0.2% of invoice value for 1001–2000cc and 0.3% above 2000cc. Cars up to 1000cc pay a flat rate, and motorcycles have a low lifetime option. A 10% rebate applies to the token portion if paid on or before 31 August, and cars 10 years or older receive relief plus withholding‑tax exemption.
| Category | Basis |
|---|---|
| Car ≤ 1000cc | Flat token + lifetime option |
| Car 1001–2000cc | ~0.2% of invoice value |
| Car above 2000cc | ~0.3% of invoice value |
| Motorcycle | Low flat / lifetime |
Sindh
Sindh uses engine‑capacity slabs administered through the Excise & Taxation Department's online portal. Motorcycles pay a small annual amount, and cars up to 1000cc can opt for a one‑time lifetime token instead of paying every year.
Khyber Pakhtunkhwa (KPK)
KPK applies withholding tax under Section 234, where filers pay roughly half of what non‑filers pay. Motorcycles benefit from a low one‑time lifetime token, making it the cheapest long‑term option for bike owners.
Balochistan
Balochistan keeps things simple with flat annual rates by engine size and offers exemptions for electric vehicles, making it one of the more predictable provinces for budgeting your annual dues.
Islamabad (ICT)
Islamabad charges a modest annual token, but the withholding tax is the main cost and the filer–non‑filer gap is large. Vehicles 10 years or older are exempt from withholding tax, which significantly reduces the bill on older cars.