IMF terms: Cabinet approves 25% sales tax on luxury items

Islamabad: The federal government Tuesday fulfilled another condition of International Monetary Fund (IMF) in which the federal cabinet approved to increase the sales tax on luxury items to 25 percent, GNN reported.

The summary approval was taken from the circulation for the notification of 25 percent sales tax from the federal cabinet, after which Federal Bureau of Revenue (FBR) will issue the notification and the new rate will be implemented from March 1.

According to details, FBR will earn over Rs15 billion in four months by increasing the sales tax on luxury items.

It is reported that the increased sales tax of 25 percent will be imposed on imported and locally manufactured 1400 cc vehicles, imported make-up products and imported electronic items.

Moreover, the 25 percent sales tax will be applicable on imported shoes, imported ladies' purses, imported pet food, lotion, shampoo, soap, imported headphones, speakers, iPod, doors and windows.

The imported luxury utensils, sanitary ware, bath fittings, imported tiles, fancy lights and chandeliers will also be considered for 25 percent additional sales tax.