Pakistan introduced a tax Tuesday on all goods transiting into Afghanistan, except supplies for US-led Nato troops fighting the Taliban, Sindh excise and taxation minister said. The decision follows a transit trade deal between Kabul and Islamabad.
"We have levied the tax under the Afghan Transit and Trade agreement signed by the two countries last year on all the goods going to Afghanistan by air and road," Sindh excise and taxation minister Mukesh Kumar Chawla told AFP.
"We have imposed a tax of 0.08 percent on the value of every item transported to Afghanistan. It will earn at least five billion rupees ($58.62 million) annually," he said. Nato goods have been shipped to Karachi and driven through Pakistan for more than nine years since the 2001 US-led invasion of Afghanistan.
But former president Pervez Musharraf exempted Nato goods from taxation, despite heavy criticism from opposition parties. "We are not applying the tax to Nato supplies because it is part of our longstanding policy," Chawla said. Pakistan was devastated by floods last year, which affected 21 million people and according to the World Bank caused $9.7 billion of damage.
The cash-strapped government is under increasing international pressure to introduce tax reforms to raise revenue, avert economic meltdown and meet IMF targets in line with a bail-out package negotiated in 2008. A standing committee in Pakistan''''s upper house of parliament last month called for taxes to be imposed on Nato goods trucked through the country.
Pakistan remains the main overland supply route for troops in Afghanistan, although the United States increasingly looks to open alternative routes in central Asia. Transporters say more than 200 tankers and trucks leave Karachi daily for Afghanistan through the Pakistani border towns of Chaman and Torkham.
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