Budget proposes excise duty on several items including snacks and sodas

Islamabad: The budget for the next fiscal year proposes excise duty on several items, including chips, biscuits, cold drinks, ice cream, and readymade meals.

According to media reports, the budget for the next fiscal year proposes excise duty on frozen foods, chips, cold drinks, noodles, ice cream, and biscuits, and a 5 percent excise duty is also proposed on frozen meat, sauces, and cooked meals.

The budget also proposes to impose excise duty on several processed items, while an 18 percent sales tax is proposed on e-commerce.

In the federal budget for the next fiscal year 2025-26, the government has included new proposals to expand the tax net, as a result of which many items are expected to become expensive, and some are expected to become cheaper.

It is also reported that the General Sales Tax (GST) rate on local vehicles up to 850 cc is proposed to be increased from 12.5 percent to 18 percent, which may result in small vehicles becoming more expensive.

On the other hand, the budget has proposed a reduction in taxes on cigarettes and beverages, which could make these products cheaper. The old trend of increasing taxes on cigarettes every year is also being considered.

Important decisions related to the property sector are also expected in the budget. According to reports, a proposal to abolish federal excise duty on property is under consideration, however, an increase in the capital gains tax rate has also been recommended.

The government has completed preparations to bring those earning income from social media and digital platforms under the tax net to expand the tax net. It has been proposed to impose additional taxes, especially on those earning income from freelancing or social media from abroad.

In addition, a proposal to end the tax exemptions enjoyed by the former FATA region may also be part of the budget, which is likely to affect the business community there.

It is pertinent to note that a budget of about Rs17,600 billion for the next fiscal year will be presented in the National Assembly today, in which new taxes of about Rs2,000 billion will be imposed.