KARACHI – Getting new car in Pakistan is becoming harder with each passing year, as prices continue to climb and affordability slips further out of reach for many buyers. With Budget 2026 taking shape, reports suggest proposed 6% Environmental Levy on petrol and diesel vehicles as another potential blow for consumers.
If implemented, the move could push already high car prices even higher, adding further pressure to an auto market that is already struggling with rising costs and shrinking purchasing power.
Pakistan’s auto sector may be heading for fresh round of price escalation as the federal government considers imposing a 6% Environmental Levy on conventional fuel-powered vehicles in the upcoming Budget 2026–27. If approved, the measure is expected to materially lift prices across key passenger car segments, with the Toyota Corolla among the most impacted models.
Under proposed structure, Corolla variants could see price increases ranging from Rs2.5-3Lac, pushing top trims near Rs80 Lac. Corolla Altis X Manual 1.6, currently priced at Rs6.202 million, is projected to rise to approximately Rs6.445 million, reflecting an increase of Rs243,000. The Altis 1.6 X CVT-i may move up by Rs267,000 to around Rs7.069 million.
Expected Corolla Prices in Pakistan after Budget
| Variant | Current Price | Expected Price | Increase |
| Corolla Altis X Manual 1.6 | 6,202,000 | 6,445,000 | 243,000 |
| Corolla Altis 1.6 X CVT-i | 6,802,000 | 7,069,000 | 267,000 |
| Corolla Altis X CVT-i 1.8 | 7,029,000 | 7,305,000 | 276,000 |
| Corolla Altis 1.6 X CVT-i Special Edition | 7,339,000 | 7,627,000 | 288,000 |
| Corolla Altis Grande X CVT-i 1.8 Beige Interior | 7,669,000 | 7,970,000 | 301,000 |
| Corolla Altis Grande X CVT-i 1.8 Black Interior | 7,709,000 | 8,011,000 | 302,000 |
Higher variants are also expected to adjust upward. The Altis X CVT-i 1.8 is likely to increase by Rs276,000 to about Rs7.305 million, while the Altis 1.6 X CVT-i Special Edition could climb to roughly Rs7.627 million, after a Rs288,000 revision.
At the upper end of lineup, the Corolla Altis Grande X CVT-i 1.8 (Beige Interior) is forecast to reach nearly Rs80Lac, while the Black Interior variant is expected to emerge as the most expensive Corolla trim at approximately Rs80.11 Lac.
The proposed levy forms part of a broader fiscal and environmental policy recalibration aimed at discouraging internal combustion engine (ICE) vehicle consumption and accelerating the shift toward cleaner mobility solutions. In parallel, policymakers are reportedly evaluating targeted incentives for electric vehicles, including potential exemptions from Federal Excise Duty (FED), Capital Value Tax (CVT), and withholding tax, which could materially improve EV affordability dynamics.
The proposal remains subject to approval, including alignment with IMF programme parameters. If enacted, it could show structural price re-rating for Pakistan’s auto market, compressing affordability for conventional vehicles while improving the relative positioning of electric alternatives.
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