Giving in to the demand put forth by the International Monetary Fund (IMF), the federal government has increased the General Sales Tax (GST) from 17% to 18%, effective immediately from February 15, 2023.
Under the chair of Prime Minister Shehbaz Sharif, the federal cabinet approved the Finance Supplementary Bill 2023 to implement another condition set by the global lender for the revival of the derailed $6.5 billion program after President Arif Alvi refused to promulgate it via an ordinance.
After getting approval from the federal cabinet on a mini-budget in the shape of the Tax Laws Amendment Bill 2023, the Federal Board of Revenue (FBR) issued the Statutory Regulatory Order (SRO) for hiking the GST rate from standard 17% to 18%.
This will bring another wave of price hikes to locally assembled cars in Pakistan. Bear in mind auto assemblers have already increased car prices up to 3 times in just 45 days since the beginning of this year. Other than GST the government might enforce more taxes & duties to cover up the revenue losses. However, the move is expected to further dent the auto sector which is already suffering from a sheer downfall in sales.
A 3d animation professional with over 20 years of industry experience having served in leading organizations & production facilities of Pakistan, an avid car enthusiast and petrolhead with an affection to deliver writings to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com