Pakistan: From High-end Mobile To SUVs, Check Items That Will Attract 25% Sales Tax

The luxury items that will come under 25 per cent sales tax in the category of food import include confectionery, jams and jelly, fish and frozen fish, sauces to fruits and dry fruits among others

Pakistan has raised sales tax from 17 per cent to 25 per cent on 33 categories of goods

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Items including decorative goods, high-end mobile phones, imported food to several other items are set to become expensive in Pakistan after the government raised sales tax from 17 per cent to 25 per cent on 33 categories of goods.

The measures are in line with its attempt to unlock the $ 1.1 billion tranche of funding from the International Monetary Fund (IMF), which has refused to release the tranche under the $7 billion loan facility unless crucial decisions are made by the government and implemented.

The Federal Board of Revenue (FBR) on Wednesday issued a Statutory Regulatory Order (SRO) for a 25 per cent imposition of General Sales Tax, The News International newspaper reported. The notice was issued to implement the last part of the Rs170 billion tax revenue measures with effect from Wednesday, reported Pakistan daily Dawn.

The luxury items that will come under 25 per cent sales tax in the category of food import include confectionery, jams and jelly, fish and frozen fish, sauces, ketchup, fruits and dry fruits, preserved fruits, cornflakes, frozen meat, juices, pasta, aerated water, ice cream, and chocolates, according to the report.

List of items to become costlier

1) Aerated water and juices

2) Confectionary items

3) Vehicles in CBU condition

4) Sanitary and bathroom wares

5) Carpets (excluding those from Afghanistan)

6) Chandeliers and lighting devices

7) Chocolates

8) Cigarettes and cigars

9) Ready-to-use cereals

10) Cosmetics and shaving items

11) Tissue papers

12) Kitchenware and household items

13) Decorations or ornamental articles, articles of jewelry, wristwatches

14) Dog and cat food

15) Doors and window frames

16) Fishes

17) Footwear

18) Fruits and dry fruits

19) Furniture

20) Home Appliances

21) Ice cream, jam, jellies

22) Leather jackets

23) Mattress and sleeping bags

24) Fresh, chilled, frozen meat

25) Musical instruments

26) Pasta, tomato catchup, sauces

27) Arms and ammunition excluding defense stores

28) Shampoos

29) Sunglasses, traveling bags, and suitcases

30) A ship, or aircraft for private use

It has also imposed 25 per cent sales tax on import of mobile phones valuing above $500 per piece, according to pkrevenue report. Apart from these commodities, 25 per cent GST has also been imposed on three categories of locally manufactured goods which include locally manufactured or assembled SUVs and CUVs, locally manufactured or assembled vehicles having engine capacity of 1,400cc and above, and locally manufactured or assembled double cabin (4x4) pick-up vehicles.

The FBR expects that the measure will help to fetch Rs7 billion on imported luxury goods and Rs 4 billion on locally manufactured vehicles in Pakistan.

Finance Minister Ishaq Dar last month through the Finance (Supplementary) Bill 2023 introduced tax measures to raise an additional Rs170 billion in the next four and a half months to meet the last prior actions decided upon with the IMF to secure early disbursement of the instalment.