Inflation to escalate further as govt ends tax exemptions
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ISLAMABAD: (Report, Aamir Sial) The government has removed tax exemptions on several items with the approval of the Finance Bill, which is likely to increase the inflation rate by over 10 percent in the next financial year.

The government has also imposed an 18 percent sales tax on food items including packed flour, rice, pulses and spices.

Heavy fines and sealing of shops have been proposed to bring traders into the tax net.

The government has also imposed a 10 percent tax on local supplies of poultry, cattle feed, sunflower seeds, rapeseed, and canola seeds.

The increase in tax on the salaried class will remain in place. Apart from books, a 10 percent tax has been imposed on stationery, 18 percent on mobile phones, and 25 percent on smartphones.

Moreover, the petroleum levy has been increased by Rs10 per litre, and the gains tax on the sale of the property has been increased by 15 percent. Tax on real estate has also been increased while an additional 10 percent surcharge will be levied on the income tax on the annual income of Rs10 million.

The capital value tax on farmhouses, ad valorem tax on luxury vehicles, and duty on air travel have also been increased.

After the approval of the finance bill, the end of tax exemptions on various items is likely to increase inflation, which is likely to burden the public further.

          
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