Under the Tax Laws (Fourth) Amendment Bill, 2021, the Federal Board of Revenue (FBR) has proposed imposing a Rs350 billion sales tax on a wide range of items, including a 17 percent sales tax on the import of LPG, mobile phones, computers, plant, machinery/equipment, and a lower rate of sales tax on the import of raw materials used in the manufacturing of medicines.
According to sources, a 17 percent sales tax has been proposed for a number of commodities at the import stage as well as domestic supply. The removal of Rs350 billion in sales tax exemptions will result in the enforcement of sales tax on a number of exempted items at both the import and local supply stages.
The tax will have an inflationary effect, which will be passed on to consumers in the form of a 17 percent increase in the price of goods.
