Source: Dawn
Date: July 21, 2010
ISLAMABAD, July 21: With the federal government introducing reformed general sales tax on October 1 to meet foreign obligations, provincial governments have asked it to provide additional funds, over and above NFC allocations, if they are to implement federal development projects in provincial domains.
A senior finance ministry official told Dawn that after the ministry’s recent meetings with the prime minister, chief ministers and the IMF mission, it had become clear that the government had no choice but to implement the reformed GST on Oct 1, originally announced by Finance Minister Abdul Hafeez Shaikh in his budget speech and approved by parliament.
Under the reformed GST, exemptions given in the old sales tax regime on five or six major sectors will stand withdrawn to yield Rs50 billion. These may include withdrawal of exemptions on major sectors like fertilisers, pesticides, pharmaceuticals, tractors, carpets, leather, sports goods, surgical goods, plant machinery and equipment, apparel, textile and footwear.
The centre will also collect GST on all taxable services in Punjab, Balochistan and Khyber Pakhtunkhwa and let Sindh to collect the tax on telecommunication and some other services like doctors, architects, lawyers and housing.
Link: http://epaper.dawn.com/ArticleText.aspx?article=22_07_2010_005_001
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