Salient Features Of Mini Budget 2023

By Published On: February 16, 20231.9 min readViews: 756

Salient Features Of Mini Budget 2023

By Published On: February 16, 20231.9 min readViews: 756
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Following are Salient features of mini budget or Finance Supplementary Bill, 2023 presented by Finance Minister Ishaq Dar in the National Assembly on Wednesday.

The finance supplementary bill is aimed at implementing the additional taxation measures that were agreed upon with the IMF, according analyst at AKD Securities.

To re call, the government and IMF agreed on the imposition of additional taxation measures of around Rs170 billion.

The salient features of the document are as below:

• BISP allocation for FY23 increased from PkR360 billion to PkR400 billion.

Amendments to the Sales Tax Act:

• Sales tax on general items has been increased to 18 per cent from 17 per cent.

• Sales tax on mobile phones with a value exceeding US$500 will be set at 25 per cent, against 17 per cent earlier.

• Essential items (Wheat Flour, rice,egg, milk, chicken and vegetable) are exempted.

• Sales tax on locally produced coal increased to 18 per cent or PkR700/ton, whichever is higher (previously higher of 17 per cent or PkR700/ton).

Amendments to the Income Tax Ordinance:

• On the acquisition of capital assets, a 10 per cent advance tax will be applicable on the gross amount of the purchase consideration. In our view this does not apply to transactions carried out at the PSX.

• A 10 per cent advance tax will be applicable on all functions and gatherings including wedding events and seminars.

Amendments to the Federal Excise Act:

• FED on aerated water is proposed to be increased to 20 per cent from 13 per cent.

• FED increased on locally produced cigarettes.

• Locally produced cigarettes if their on-pack printed retail price exceeds PkR9,000 (from PkR6,660) per 1000 cigarettes to PkR16,500 (from PkR6,500).

• Locally produced ciga rettes if their on-pack printed retail price does not exceed PkR9,000 (from PkR6,660) per 1000 cigarettes to PkR5,050 (from PkR2,050).

• Minimum price on cigarettes: No brand shall be priced and sold at a retail price (excluding sales tax) lower than 60 per cent (previously 45 per cent) of the retail price.

• FED on Sugary drinks introduced at 10 per cent of retail price.

• FED increased on cement to PkR2.0/kg (previously PkRl.5/kg).

• FED on air travel (club, business and first class) has been increased to 20 per cent of the airfare or PkR50,000/ticket, whichever is higher from the earlier held PkR50,000/ticket.

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Rida Malik

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