PESHAWAR: The federal government has proposed a six-month ban on imports of luxury vehicles and a 17 per cent tax increase on cosmetics and other luxury items in the mini budget.
An amendment bill is being considered to end the tax exemption of Rs350 billion on the demand of IMF [International Monetary Fund]. The source said that the draft tax amendment bill is likely to be ratified by the Law Ministry, soon.
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The sources said that government is planning tax exemption of Rs27 billion on mobile phones but proposed to increase the tax rate on expensive smartphones, including iPhones. Apart from this, increase in tax on packaged food items, including imported butter and cheese is also under consideration. Prices of petroleum products can go up by Rs15 to 20 per liter and the baby milk which is available for Rs3, 000 will be available for Rs3, 500 after the passage of mini budget from the parliament. The price of powdered milk will increase by Rs60 to Rs100 per packet, says media reports.
After the mini budget, the price of frozen meat and branded desi ghee would increase by up to Rs200 per kg. Raw materials for home appliances, LED bulbs and various plants will also see price-hike. And with the abolition of tax exemption on electric vehicles, their value will also increase by Rs4 to 7 lakh. The price of chicken is likely to go up as poultry feed is going to see hike after the government abolish examption. Tax exemptions on education, medicine, foreign diplomatic missions and charities are likely to be maintained.
The final draft of the proposed mini-budget will be approved by the Federal Cabinet, after which it will be tabled in the parliament for approval. Officials say a presidential ordinance will be issued for the mini-budget, if needed. The IMF has set strict condition for the approval of $6 billion loan package in the meeting with Pakistan delegation in Washington last month.