| GEO Business|
| Sindh, center drama on VAT ends; reach consensus|
| Updated at: 0710 PST, Saturday, June 05, 2010|
ISLAMABAD: The deceptive drama between federal and the Sindh governments ended as two sides reached an agreement on Friday regarding the imposition of Value Added Tax (VAT) from July 1.
According to the agreement, the Federal Board of Revenue (FBR) will collect VAT on financial, construction, franchise and advertising services from all provinces, including Sindh.
The tax collected will be maintained in a soon-to-be created fund, from which 50 percent will be provided to Sindh, while the remaining will be divided between the rest of the provinces.
However, Sindh will itself impose tax on over 30 other services, including telecom services, and also collect it.
Meanwhile, the finance adviser had said the existing sales tax regime was “rotten and outdated” and needed to be replaced.