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.
- 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.
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.
- 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.