Budget 2026-27 Taxation June 30, 2026Hamza Shahnawaz Private vehicles up to 1,000cc to pay Rs20,000 lifetime token tax, while larger vehicles face annual levy based on invoice value from July 1, 2026. ISLAMABAD: The federal government has introduced revised token tax rates for vehicles registered in the Islamabad Capital Territory (ICT) through the Finance Act, 2026, with the new taxation structure coming into effect from July 1, 2026. The amendments have been made to the West Pakistan Motor Vehicles Taxation Act, 1958 (WP Act XXXII of 1958), replacing the existing Tables 2, 3, 4 and 5 of the Schedule applicable in the Islamabad Capital Territory. Under the revised framework, private motor vehicles with engine capacity of up to 1,000cc will now be subject to a one-time lifetime token tax of Rs20,000, while vehicles above 1,000cc will pay annual token tax based on a percentage of the vehicle’s invoice value. The Finance Act also revises annual token tax rates for motor cabs, public service vehicles and commercial/loading vehicles operating within Islamabad. Token Tax Rates for Private Motor Vehicles (ICT) S.No Engine Capacity New Tax Rate 1 Up to 1000cc Rs20,000 (Lifetime) 2 1001cc – 1300cc 0.25% of invoice value per annum 3 1301cc – 1500cc 0.25% of invoice value per annum 4 1501cc – 2000cc 0.25% of invoice value per annum 5 2001cc – 2500cc 0.35% of invoice value per annum 6 Above 2500cc 0.35% of invoice value per annum Annual Token Tax for Motor Cabs…