06-01-2011, 12:22 PM
By Sajid Chaudhry
ISLAMABAD: The federal government is likely to impose 17 percent general sales tax (GST) on agriculture plant machinery and implements in the budget 2011-12, official sources informed Daily Times on Tuesday.
“GST would be imposed on imported as well as locally manufactured agriculture plant machinery and implements, and local supply of such goods would also be subjected to the GST,” the sources explained.
“The federal government has already withdrawn GST exemption on tractors, fertilisers and pesticides, and with the elimination of exemption agriculture plant machinery and implements will complete the process of taxing agriculture sector indirectly,” sources added.
Sources further informed that the federal government was charging eight percent of GST on the ex-factory price of the sugar and in the budget eight percent of federal excise duty would also be imposed on sugar so as to make a total taxation impact of 16 percent on sugar in the budget 2011-12.
Sources further informed that the federal excise duty imposed on the development of real estate for commercial or residential purposes, few years ago, would be abolished in the budget 2011-12. “FBR is trying it’s level best to impose Gross Asset Tax (GAT) or Minimum Asset Tax (MAT) in the budget. However, due to the passage of the 18th Amendment right of taxing assets has been vested with the provinces and in the budget real estate sector will get relief against any further new taxation,” explained the sources.
Sources said that the government was also expected to withdraw sales tax exemption on medical equipments used by commercial hospitals in the coming budget (2011-2012). “The hospitals operating on charitable basis and those run by government are enjoying complete exemption on the import and supply of all categories of goods,” they said and added, “Ambulances and medicines are also exempted.”
The general exemption on surgical tapes, ultrasound gel and diapers for adults (patients) is also available. Such diapers fall under Pakistan Customs Tariff (PCT) head 4818.4010. However, diapers of PCT head 5601.1040 are zero-rated under SRO 283(I)/2011 and their inputs are zero-rated under SRO 1161(I)/2007.
ISLAMABAD: The federal government is likely to impose 17 percent general sales tax (GST) on agriculture plant machinery and implements in the budget 2011-12, official sources informed Daily Times on Tuesday.
“GST would be imposed on imported as well as locally manufactured agriculture plant machinery and implements, and local supply of such goods would also be subjected to the GST,” the sources explained.
“The federal government has already withdrawn GST exemption on tractors, fertilisers and pesticides, and with the elimination of exemption agriculture plant machinery and implements will complete the process of taxing agriculture sector indirectly,” sources added.
Sources further informed that the federal government was charging eight percent of GST on the ex-factory price of the sugar and in the budget eight percent of federal excise duty would also be imposed on sugar so as to make a total taxation impact of 16 percent on sugar in the budget 2011-12.
Sources further informed that the federal excise duty imposed on the development of real estate for commercial or residential purposes, few years ago, would be abolished in the budget 2011-12. “FBR is trying it’s level best to impose Gross Asset Tax (GAT) or Minimum Asset Tax (MAT) in the budget. However, due to the passage of the 18th Amendment right of taxing assets has been vested with the provinces and in the budget real estate sector will get relief against any further new taxation,” explained the sources.
Sources said that the government was also expected to withdraw sales tax exemption on medical equipments used by commercial hospitals in the coming budget (2011-2012). “The hospitals operating on charitable basis and those run by government are enjoying complete exemption on the import and supply of all categories of goods,” they said and added, “Ambulances and medicines are also exempted.”
The general exemption on surgical tapes, ultrasound gel and diapers for adults (patients) is also available. Such diapers fall under Pakistan Customs Tariff (PCT) head 4818.4010. However, diapers of PCT head 5601.1040 are zero-rated under SRO 283(I)/2011 and their inputs are zero-rated under SRO 1161(I)/2007.