Thursday, 22 February 2024
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List of Items that will face a price hike after approval of supplementary budget 2021

The federal government presented the supplementary finance bill 2021 before the Parliament for withdrawal of General Sales Tax (GST) exemptions and proposed imposition of 17% tax on nearly 150 items on Thursday.

According to the details of the bill, 17% GST will be imposed on 140 essential consumable and industrial goods.

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Here is a list of items that will witness a price hike following the approval of the supplementary finance bill — termed by the Opposition as a “mini-budget“.

  • Imposition of advance tax on foreign-produced TV dramas and serials as well as advertisements starring actors from other countries (PKR 3mn per episode on plays and PKR 5mn per second on actors);
  • 17% GST will be imposed on items sold in bakeries, restaurants, and sweet shops, foodstuff served in-flight kitchens, sausages and products of poultry meat locally produced crude vegetable oil, cereals, and openly-sold red chillies.
  • Tax rate on import of oil seeds will go up from 5% to 17%.
  • The GST on silver and gold will increase from 1% to 17%.
  • Goods received as gifts from a foreign government or organisation will be taxed at 17%.
  • Items sold in sachets to be subjected to a GST of 17% against 8% previously.
  • Seeds, plants, tools and chemicals of the agriculture sector will also be subjected to 17% GST.
  • 10% sales tax to be imposed on imported vegetables.
  • 10% tax to be levied on flour mills.
  • 5% tax on fitness centres, laundries, beauty salons, travel agencies, industrial machinery workshops and automobile workshops located in ICT.
  • 5% tax will be levied on imported laptops, personal computers and notebooks.
  • Cottonseed is proposed to be taxed at 17% GST. 

Telecommunication and Information Technology

  • Finance bill proposes an increase in income tax on cellular services (mobile phone calls) from 10% to 15%.
  • Proposes an increase of 5% withholding tax (WHT) on telecom services.
See also  No sales tax on wheat flour and related items

Automobile assemblers and parts manufacturers

  • Sales tax on batteries will be increased from 12% to 17%.
  • GST to be increased on locally-manufactured cars above 850cc from 12.5% to 17%.
  • Services provided by car/automobile dealers in ICT will be taxed at 5%.
  • 17% GST will be imposed on hybrid electric vehicles over 1,800cc.

Pharmaceutical

  • Imposition of 17% GST at the import stage on raw materials of medicines.

Food and Dairy

  • 17% GST will be imposed on processed milk and dairy items sold in branded packaging as well as items sold in restaurants and sweet shops.
  • 17% GST will be imposed on imported animals and livestock.
  • 17% sales tax will be levied on poultry machinery.
  • 17% GST will be imposed on imported infant formula milk, which is currently being subjected to no GST.

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