PM reviews Pakistan’s ‘gas situation’, asks officials to fast-track licences ......

adding that tax exemptions of Rs343bn had been benefiting various interest groups for the past 70 years. “We have targeted only those items which are used by the elites.”

However, Mr Tarin said the levy of 17pc sales tax on some specific items would raise Rs2bn, adding that the tax on these items would only affect the ordinary people. “We have only increased the cost of imported luxury items,” he said, adding that local supply of most items remained unchanged. The minister explained that withdrawal of tax exemptions worth Rs112bn on machinery and Rs160bn on pharmaceutical sector is adjustable and refundable. He did not consider these as taxes which will now be collected at the rate of 17pc on import of machinery and from the pharma sector. The bill proposes 17pc sales tax on a number of items which were earlier exempted from the tax. The government terms these products luxury items which include import of live animals, steak meat, fish, vegetables, high-end bakery items, branded cheese, imported sausages, high-end cellphones and import bicycles. At the same time, a number of items is proposed in the bill for targeted subsidy to minimise the impact of 17pc sales tax. These include oilcake, animal feed, poultry feed, maize seed (for corn oil) and cottonseed (for oil mills). Other items that will now attract 17pc tax on import are magazines and fashion journals. The targeted subsidy plan of Rs33bn has been proposed to protect any segment of population which may get affected even indirectly by the withdrawal of some exemptions, etc.