Possible rephrased title: Budget 2024-25 Forecast Indicates Rising Prices for Sugar, Rice, Flour, and Milk
Published on: May 30, 2024.
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Inflation Expected to Rise in Pakistan’s 2024-25 Budget, Says IMF
The International Monetary Fund (IMF) has reportedly urged Pakistan to reduce sales exemptions in the upcoming 2024-25 federal budget, leading to potential price increases in essential items such as milk, tea, sugar, rice, flour, and packed milk. This move comes as the IMF demands the imposition of a 5-10% sales tax on the zero-rated sales tax sector, as well as the elimination of tax exemptions in FATA and PATA by June 30.
According to budget proposals for the FY2024-25, Pakistan is considering a phase-wise elimination of exemptions on sales and income tax. This move is seen as a response to the IMF’s request, as the country seeks to secure a new loan program from the organization.
Additionally, the government is contemplating the imposition of a sales tax on tractors and pesticides. This measure could potentially lead to price hikes for these vital agricultural products. Currently, pesticides and their active ingredients registered by the Department of Plant Protection are exempt from sales tax under the Sixth Schedule of the Sales Tax Act.
It remains to be seen how these changes will impact the overall economy and the daily lives of Pakistani citizens. However, it is clear that the IMF’s request for reduced sales exemptions will have significant repercussions on various sectors.
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