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ISLAMABAD: The federal government is planning to raise sales tax on tractors from 10 to 14 percent.

In the last budget (2024-25), a sales tax exemption was withdrawn on tractors, and a 10 percent sales tax was imposed.

Sources told Business Recorder that the Federal Board of Revenue has recently held a meeting in this regard. The Board has completed working on a proposal to increase sales tax on tractors from 10 percent to 14 percent.

Tractor industry faces crisis due to 10pc ST

The tax department will increase the tax after the approval of the Cabinet.

The finance ministry has forwarded the summary to the cabinet in this regard, source added. Sources further informed that the rationale behind increasing sales tax to 14 percent is that the 10 percent of their input is not fully consumed. On the other hand, the standard rate of sales tax is 18 percent. Resultantly, the refund is generated for the tractors industry. To check the phenomenon of refunds within the tractor’s industry, the proposal is under consideration to raise sales tax on tractors.

Through Finance Act 2024, the government has imposed 10 percent sales tax on tractors from July 1, 2024.

Earlier, the government had exempted tractors from sales tax.

Copyright Business Recorder, 2024

Comments

Comments are closed.

Aamir Aug 04, 2024 08:14am
Good...tax agriculture and remove all subsidies. Also no check on prices. Let it be an industry on demand and supply. Food prices are very low and should be raised by farmers. Let them make money
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KU Aug 04, 2024 10:10am
Agri-sector output is only lied upon on papers/reports, it's dismally low. Doesn't make any difference to tractor industry because prices are already unaffordable. Surprising is the silence on SIFC.
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Retired Aug 04, 2024 10:24am
Tax everything and everyone! After all, someone has to pay for new cars for govt officials and free electricity for judges! And don't forget the funds for MNAs!
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Sohail Aug 04, 2024 08:47pm
Mandd kay rakho is ghulam qoum ko
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