Karachi: The collection of sales tax on imports rose to PKR 70 billion during the first seven months (July-January) of the current fiscal year, according to a news report. To this effect, the government was seen to maintain a growth rate of 21%.
Further, the trade deficit has narrowed by 30% during the
first half of the current fiscal year – owing to a significant decline reported
in import bill for the said period. It stood at USD 11.69 billion during
July-December in the current fiscal, compared with the deficit of USD 16.77
billion for the same period last year.
The import bill declined by 17% during the first half of the fiscal year to USD 23.23 billion, as compared with USD 27.95 billion in the corresponding half of the last year.
The country’s tax authorities attributed the increase in
sales tax collection to the abolishment of the zero-rating regime for all local
and import supplies – announced in the federal budget 2019-20.
The government had replaced its zero-rating regime with normal
sales tax rate of 17%. However, the exporters had been allowed to claim refunds
against payment of 17% tax on import of their raw material and other capital
goods.
