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Friday Dec 31 2021
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Which items will become expensive after mini-budget’s approval?

Men wearing protective face masks shop for grocery items at a store ahead of the holy fasting month of Ramadan, amid the coronavirus disease (COVID-19) pandemic, in Peshawar, Pakistan April 9, 2021. Reuters/File
Men wearing protective face masks shop for grocery items at a store ahead of the holy fasting month of Ramadan, amid the coronavirus disease (COVID-19) pandemic, in Peshawar, Pakistan April 9, 2021. Reuters/File

ISLAMABAD: The federal government presented the supplementary finance bill 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.

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.

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.