25pc GST imposed on ‘luxury’ items

ISLAMABAD: The Federal Board of Revenue (FBR) on Wednesday issued the Statutory Regulatory Order (SRO) for the imposition of 25 percent General Sales Tax (GST) on 36 imported items.

Twenty-five percent GST has also been imposed on three categories of locally manufactured goods, including locally manufactured or assembled SUVs and CUVs, locally manufactured or assembled vehicles having engine capacity of 1,400cc and above and locally manufactured or assembled double cabin (4x4) pick-up vehicles.

The FBR has estimated that it will fetch Rs7 billion through raising tax on imported luxury goods and Rs4 billion on locally manufactured vehicles.

The government had enacted the Finance Supplementary Act 2023 in order to get Rs170 billion revenues for reviving the stalled programme of the International Monetary Fund (IMF).

“The federal government is pleased to direct that the sales tax shall be charged, levied and paid at the rate of 25 percent of the value of the goods imported and their subsequent supply or the retail price,” read the SRO.

The imported goods include aerated water and juices, confectionery, vehicles in CBU condition, sanitary and bathroom wares, carpets (excluding those from Afghanistan), chandeliers and lighting devices or equipment, chocolates, cigarettes, cigars and e-cigarettes, corn flakes and other ready -to-use cereals, cosmetics and shaving items, tissue papers, crockery, kitchenware and tableware and household articles, decorations or ornamental articles, dog and cat food only, doors and window frames, fish, footwear, fruits and dry fruit (excluding those imported through land route or barter mechanism), furniture, home appliances CBU, ice cream, jams, jellies, preserved fruits and fruit and vegetable juices, leather jackets and apparels, mattress and sleeping bags, fresh , chilled, frozen, preserved or processed meat, musical instruments, pasta, arms and ammunition (excluding defence stores), shampoos, sunglasses, tomato ketchup and sauces, travelling bags and suitcases, a ship designed or adapted for use for recreation or pleasure or private use, an aircraft designed or adapted for use for recreation or pleasure or private use, articles of jewelry (both precious metals and imitation) and wristwatches.

The SRO states it is clarified that the provisions of this notification shall not be applicable in respect of goods specified in the Eighth Schedule to the Sales Tax Act 1990.