The Finance Bill 2026 introduces a significant revision in token tax rates for motor vehicles in the Islamabad Capital Territory (ICT), impacting private cars, motor cabs, public service vehicles, and commercial transport. The updated structure shifts toward engine capacity–based percentage taxation for higher-end vehicles while keeping fixed rates for smaller categories.
These changes are expected to increase revenue collection and align vehicle taxation with market value and engine size.
🚗 Token Tax on Motor Vehicles (ICT)
Under the revised regime, vehicles up to 1000cc will now pay a fixed annual token tax, while larger engine capacities will be taxed on an invoice-value percentage basis.
- Up to 1000cc: Rs. 20,000 (fixed)
- 1001cc to 1500cc: 0.25% of invoice value
- 1501cc to 2000cc: 0.25% of invoice value
- 2001cc to 2500cc: 0.35% of invoice value
- Above 2500cc: 0.35% of invoice value
This marks a shift toward value-based taxation for mid and high-end vehicles.
🚖 Motor Cabs – Revised Token Tax Rates
Motor cabs will continue to be taxed based on engine capacity, with fixed annual rates:
- Up to 1000cc: Rs. 600
- 1001cc – 1300cc: Rs. 1,000
- 1301cc – 1500cc: Rs. 1,700
- 1501cc – 2000cc: Rs. 2,500
- 2001cc – 2500cc: Rs. 3,400
- Above 2500cc: Rs. 4,200
The revised structure maintains affordability for smaller cabs while increasing contributions from larger vehicles.
🚌 Public Service Vehicles (Per Seat Per Year)
Public transport vehicles will now be taxed on a per-seat basis:
- 8-seater: Rs. 350 per seat
- 13-seater: Rs. 400 per seat
- 15-seater: Rs. 500 per seat
- 16-seater: Rs. 600 per seat
- 42-seater: Rs. 700 per seat
- 52-seater: Rs. 850 per seat
This system ensures taxation is linked directly to passenger capacity.
🚛 Commercial & Loading Vehicles – Updated Rates
Commercial transport vehicles see a detailed restructuring based on laden weight:
- Up to 1250 KG: Rs. 500
- 1250–2030 KG: Rs. 1,000
- 2030–4060 KG: Rs. 1,000
- 4060–6090 KG: Rs. 6,600
- 6090–8120 KG: Rs. 6,600
- Above 8120 KG: Rs. 12,000
- 12,000–16,000 KG (Trailers): Rs. 18,000
- Above 16,000 KG: Rs. 24,000
- Tractor (with or without trolley): Rs. 2,600
📊 Key Highlights of Finance Bill 2026 Token Tax Changes
- Introduction of invoice-based token tax for mid/high-end cars
- Higher contribution from luxury and large-engine vehicles
- Continued fixed taxation for small vehicles and motor cabs
- Rationalization of commercial vehicle taxation based on weight
- Separate structured regime for public transport per seat
🧾 Impact Overview
The revised token tax structure is expected to:
- Increase compliance and documentation in the vehicle sector
- Shift tax burden toward higher-value vehicle owners
- Maintain relief for small engine vehicles and public transport operators
- Improve provincial/ICT revenue collection efficiency
The Finance Bill 2026 introduces a more structured and tiered token tax system in Islamabad Capital Territory, aiming to balance revenue generation with affordability for lower-income vehicle owners. The emphasis on engine capacity and vehicle value signals a shift toward a more modern taxation framework.
