The Federal Government is hard at work to squeeze as much money as possible from the citizen’s pockets after its failure. According to the details, the Government is mulling to imposed increased General Sales Tax (GST) on more luxury items in order to fetch an additional Rs. 11 billion in revenue to please the International Monetary Fund (IMF) for continuing the loan programme.
A summary has been forwarded with a list of additional items to be charged 25% GST instead of the standard 18% as they fall under the label of ‘luxury items’ in the country. According to the details, these items include aircraft, boats/ships (for pleasure, recreation, and private use), jewelry, and wrtiswatches.
Meanwhile, the Government has also proposed to tax some locally manufactured vehicles at the higher rate of GST, including SUVs and CUVs, vehicles with engine capacity of 1400cc and above, and quad-cab pickup 4×4 trucks.
However, this will not include categories of vehicles like locally manufactured electric vehicles (EVs) with a battery capacity of 50Kwh, electric three-wheelers, e-bikes, and hybrid electric vehicles (HEVs) of up to 2500cc.
The Federal Government has already proposed the taxation of luxury items at a higher rate of General Sales Tax (GST) – from 17% to 18% – and has already made a list of items that fall under the scope of ‘luxury’.
The increased taxes will likely help the Government raised Rs. 7 billion on imported items, while another Rs. 4 billion will be generated through the taxes on locally manufactured luxury vehicles like SUVs, which is suppose to help the Government to meet the revenue shortfall and convince the International Monetary Fund (IMF) to release the next tranche of $1.1 billion.
The list of items categorized as luxury by the Government in the earlier summary included imported Home appliances, Cosmetics, Crockery, Pet food, Private weapons and ammunition, Shoes, Chandeliers and lighting (except energy savers), Headphones and loudspeakers, Doors and window frames, Traveling bags and suitcases, Sanitary ware, Carpets, Tissue paper, Furniture, Shampoos, Automobiles (CBU), Luxury mattresses and sleeping bags, Bathroom ware/toiletries, Heaters/blowers, Sunglasses, Kitchenware, Cigarettes, Shaving goods, Luxury leather apparel, Musical instruments, Saloon items like hairdryers and decoration/ornamental articles, Confectionery, Jams and jelly, Fish and frozen fish, Sauces, Ketchup, etc, Fruits, dry fruits (except from Afghanistan), and preserved fruits, Cornflakes, Frozen meat, Juices, Pasta, Aerated water, Ice cream, Chocolates (in retail packing),
Read more: Govt Increases Taxes on Cars in Mini Budget.
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