Daily Times

Following are the proposed budgetary measures pertaining to Sales Tax and Federal Excise Duty (FED) for FY 2024-25:

– Withdrawal of various exemptions/zero rating and reduced/fixed rates.

– Mobile phones to be taxed at standard rate (other than mobile phones valuing exceeding US$ 500 which will remain chargeable to existing rate of 25%).

– Enhancement in reduced rate of sales tax from 15% to 18% on supplies made by the POS retailers dealing in leather and textile products.

– withholding regime for lead, coal, scrap of paper and plastic, silica etc.

– Iron and steel scrap to be exempted from levy of sales tax.

– A phased withdrawal of exemption granted to ex-FATA/PATA.

– Board empowered to fix minimum price of the goods falling under Third Schedule.

– Streamlining and strengthening the provisions related to tax fraud.

– Changes in the legal provisions related to assessment and audit.

– Zero-rating of petroleum products is being converted into exemption.

– Rate of default surcharge is to be aligned with the SBP?s policy rate of KIBOR plus 3%.

Federal Excise Duty

The proposed budgetary measures pertaining to Federal Excise Duty (FED) for FY 2024-25 are:

– Imposition of FED on acetate tow @ Rs. 44,000 is proposed.

– Imposition of FED on nicotine pouches @ Rs. 1200 per kg.

– Enhancement of FED on e-liquids is also proposed.

– FED @ Rs. 15 per kg on supply of sugar to manufacturers.

– The rate of FED on cement is being enhanced from Rs. 2 per kg to Rs. 3 per kg.

– FED on commercial properties and first sale of residential properties @ 5%.

– Rate of FED on filter rod to be enhanced from Rs.1500 per kg to Rs.80,000 per kg.

– power to seal business premises of retailers selling illicit cigarettes.

– Exemption from FED to diplomats and diplomatic mission.

– Price threshold for local manufactured cigarettes increased from Rs. 9,000 to Rs.12,500.