The current administration has prepared a “mini-budget” to raise Rs170 billion in income in response to the International Monetary Fund’s (IMF) requests to levy additional taxes on the people who are suffering from inflation.
For the purpose of collecting taxes totaling Rs115 billion, the Federal Board of Revenue (FBR) has issued an SRO increasing the ordinary 17% general sales tax (GST) to 18%. The remaining Rs55 billion will be raised by additional measures in line with the Finance (Supplementary) Bill 2023.
The top tax collecting agency stated in the notification that a variety of things needed in daily life, including consumer packaged goods, will be subject to the 18% GST.
After an increase in the GST, the following items will get expensive:
- Edible oil
- Biscuits
- Jam
- Jelly
- Noodles
- Children’s toys
- Chocolates
- Coffee
- Make-up
- Shampoos
- Creams
- Lotion
- Soap
- Toothpaste
- Hair colour
- Hair remover cream
- Hair gel
- Shaving foam
- Shaving gel
- Shaving cream
- Shaving blades
- Computers
- Laptops
- Electronic gadgets
- Smartphones
- iPods
- TVs
- LEDs
- LCDs
- Juicers
- Blenders
- Other electronic machinery
- Car shampoos
- Car polishes
- Perfumes
- Branded perfumes
In addition to these actions, the government will raise the GST rate on luxuries from 17% to 25%. Federal Excise Duty (FED) would rise to Rs 20,000 or 50%, whichever is higher, on business and first-class airline tickets.
The withholding adjustable advance income tax rate for marriage halls will be 10%. The FED will also be shifted up in regard to cement and soft, sugary drinks.
