KARACHI: Imposing of 25% sales tax on the import and local supply Of luxury items is a wonderful step to discourage the luxury Items and encourage, the austerity, said Ateeq Ur Rahman, economic & financial analyst.
He said up to ninety five percent of tax revenue is collected through indirect tax, customs duty and withholding tax which seems to be enough to meet the revenue collection target of Rs.7.64 trillion inclusive of additional revenue measures Of Rs 170 billion.
Further FBR has issued the updated Sales Tax Act, which revealed that the FBR has replaced 17% Sales Tax with 18%. Moreover FBR has imposed a25% Sales Tax on the import and local supply of luxury items.
He said there has to be a difference between essential and non-essential items in the category of luxury Items. “Segregating the list, I think that confectionery, jams, jellies, cornflakes, cereals, pasta, tomato ketchup & Sauces, fish and frozen/ fresh meat are essential items and required to build the local competition and maintain the equilibrium between demand and supply.” Having said that the only request is made to reduce the chargeable number of sale tax; this will help in checking the ballooning food inflation already existing at 37%, added Ateeq.
Government is hereby requested to categorize the minimum tax, encourage the fixed tax and adjustable tax. Sale Tax of anything and one very thing has to be justified when withholding tax, Customs Duty and Indirect taxes are under formation.
Copyright Business Recorder, 2023
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