May 22, 2013
Presidential Ordinance on taxation measure has proposed 16 percent standard rate of sales tax on sugar. Sources told us here on Tuesday that earlier the FBR has proposed to enhance sales tax on sugar in coming budget (2013-14). Now, the 16 percent sales tax on the commodity would be imposed through the Presidential Ordinance before the announcement of budget.
The FBR has estimated to collect Rs 10 billion from this measure in case the Presidential Ordinance is promulgated. Sources said that the Board intended to revise the federal excise duty (FED) rate on sugar. The commodity is currently exempt from sales tax and charged to FED at the rate of 8 percent as compared to all major commodities/products which are chargeable to standard rate of 16 percent sales tax. This preferential treatment given to sugar industry resulted in huge revenue loss to the government exchequer. The FBR has proposed that instead of FED, sales tax @ standard rate of 16 percent (or 17 percent as being proposed separately) may be levied. Business Recorder