Cars, mobile phones, cosmetics to get costlier as govt plans to slap 25pc GST on more ‘luxury items’


ISLAMABAD – The federal government has decided to jack up the cess on cars, mobile phones, cosmetics, and several luxury items from 18pc to 25pc as the South Asian nation struggles to unlock critical funding from the International Monetary Fund (IMF).

It was learnt that Sharif-led government has moved a summary for increasing revised general sales tax (GST) on several luxury items to draw an additional Rs11 billion.

The move is said to be another bid to salvage the stalled funding from International Monetary Fund as a summary has been forwarded to the cabinet through circulation.

The summary recommended increasing the taxes on aircraft and boats/ships, jewelry, motor vehicles of engine capacity 1400cc and above, and 4×4 trucks, imported beverages, auto completely built units (CBU), bathroom wares, carpets, chocolates, cigarettes, bakery items, cosmetics, tissue papers, crockery, decoration pieces, dog and cat food, doors and window frames, fish, footwear, fruits and dry fruits, furniture, homes appliances, leather jackets and mattress, frozen or processed meat, mobile phone (CBU), shampoos, sauces, ice cream, and jams.

The additional tax measures are expected to further amplify the pace of monthly consumer price inflation, which has recently increased to nearly half a century high, with prices of several commodities climbing up.

In the latest development, the weekly inflation skyrocketed to 41per cent on a year-on-year basis on the back of edible oil, sugar, and vegetables, official data shows. Cigarettes saw an increase of 165.86pc, gas charges 108.38pc, diesel 93.82pc, petrol 77.89pc, chicken meat 64.70pc.