The prices of large engine vehicles in Pakistan, including popular models such as the Toyota Fortuner and Toyota Revo, are expected to increase from July 2026 after the federal government announced a new Federal Excise Duty (FED) in the Budget 2026–27.
Finance Minister Muhammad Aurangzeb presented the federal budget in the National Assembly with a total outlay of Rs18,771 billion, introducing several new taxation measures aimed at increasing government revenue. Among the key proposals is the imposition of an excise duty on vehicles with engine capacities exceeding 2,000cc.
Under the new policy, the additional FED will apply to both imported completely built units (CBUs) and locally assembled vehicles falling within the large-engine category. As a result, buyers of premium SUVs, luxury sedans, and high-powered pickup trucks are likely to face significantly higher prices from the start of the new fiscal year.
Automobile industry analysts believe the decision will have a direct impact on some of the country’s most sought-after premium vehicles. Models such as the Toyota Fortuner and Toyota Revo, which remain highly popular among consumers, are expected to see noticeable increases in their invoice prices due to the added tax burden.
The move is part of the government’s broader fiscal strategy to generate additional revenue while placing a greater tax burden on higher-value and luxury goods. However, market experts say the higher taxes could slow demand in the premium vehicle segment, with some buyers delaying purchases or shifting towards lower-engine alternatives.
The expected increase in vehicle prices may also influence the overall automotive market, particularly in the SUV and luxury pickup categories. As the Budget 2026–27 measures come into effect from July, consumers and dealerships alike are preparing for changes that could reshape buying trends across Pakistan’s high-displacement vehicle sector.
