AMMAN — The Cabinet had reviewed its decision No. 4306, issued on June 28, which cancels all exemptions on vehicles from the general sales tax, a government source said on Sunday.

Under the decision, all petrol, electric and hybrid vehicles are now subject to a 16 per cent sales tax, in line with Article 23 of the 1994 General Sales Tax Law, following a recommendation by the Economic Modernisation and Development Committee on August 31.

The source told the Jordan News Agency, Petra, that during its September 8 session, the Cabinet decided to exempt electric and hybrid vehicles that had already cleared customs before the June 28 decision from the new sales tax.

The move, the source said, was made to rectify the situation and ensure fairness.

On June 28, the government also amended the special tax bylaw on vehicles, bringing electric and hybrid cars under the sales tax for the first time. Previously, they were subject only to the higher special tax, unlike petrol cars, which had been taxed under both bylaws.

The source noted that this change created overlapping tax burdens on some vehicles cleared just days before the decision, prompting the exemption. The adjustment affects between 800 and 900 vehicles.

The source stressed that the measure is intended to achieve fairness and serve the public interest.

On June 28, the Cabinet, during a session chaired by Prime Minister Jafar Hassan, also approved an amended Special Tax bylaw that reduced the overall taxes and customs duties on vehicles. The amendments aim to ease burdens on citizens and address distortions in the sector.

Under the amendment, the total tax rate on petrol cars was cut from 71 per cent to 51 per cent, marking a 28 per cent reduction.

For hybrids, the rate dropped from 60 per cent to 39 per cent, a decline of 35 per cent.

The special tax on electric vehicles was set at a flat 27 per cent for all categories, replacing the previous bylaw that gradually raised the rate to 55 per cent.

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