Cabinet approves Finance Supplementary Bill 2023; 1% increase in GST

Islamabad: The federal cabinet on Tuesday approved the Finance Supplementary Bill 2023 providing for a 1% increase in general sales tax (GST) and additional taxes on luxury items as part of the reforms related to the International Monetary Fund’s (IMF) Ninth Review.

The supplementary bill was passed in a cabinet meeting chaired by Prime Minister Muhammad Shehbaz Sharif who gave the directives not to tax any daily use items which could affect the poor or middle class.

During the briefing given to the prime minister, it was told that under the reforms, luxury items would be taxed.

The prime minister said: “The government was making maximum efforts to put the minimum possible burden on the poor people;” however, he called for taking necessary measures to tax luxury goods.

The supplementary finance bill would now be tabled before the parliament on Wednesday as the president has already summoned the sessions of the National Assembly and Senate.

Shehbaz Sharif stated: “An austerity policy would be adopted at the government level which would soon be formally announced as the economic difficulties could only be overcome while limiting ourselves within our resources”.

He said all of the cabinet members and the government officers would be bound to adhere to the austerity package as it was inevitable to steer the country out of economic challenges.

Shehbaz remarked, “The 220 million of Pakistan were bearing the brunt of the incompetence and negligence of the previous government” adding that, “We assumed the power in difficult circumstances and sacrificed our politics for sake of the state. The previous government betrayed the people through its tall claims of simplicity and austerity”.

The federal cabinet approved the renaming of the Turkiye Earthquake Victims Fund as Turkiye and Syria Earthquake Victims Fund with the prime minister urging the people to donate wholeheartedly to this fund.

The prime minister expressed condolence over the destruction caused by the unprecedented earthquake in Turkiye and Syria. He also apprised the cabinet members of his telephonic interaction with Turkish President Recep Tayyip Erdogan in which he assured Pakistan’s all-out support to the quake-hit people.

The premier further stated: “The relief goods including blankets, warm clothes and others had been dispatched to Turkiye and Syria while more goods were also being sent there”. The Pakistan Air Force, rescue workers, NGOs and philanthropists were also taking part in the relief activities, he added.

The cabinet members also offered Fateha for the late mother of Advisor to Prime Minister Ahad Cheema.

The federal cabinet endorsed the Economic Coordination Committee’s (ECC) decisions it had taken in its respective meetings held on February 10 and 13, 2023. It also endorsed the decisions of the Cabinet Committee on Legislative Cases taken in its meeting held on February 9, 2023.