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FBR opposes ‘sin tax’, says will promote illegal business, smuggling

KARACHI: The Federal Board of Revenue (FBR) on Wednesday opposed the government’s decision to impose ‘sin tax’ on soft drinks and cigarettes, ARY News reported.

According to the FBR the sin tax will badly affect the tax revenue, said sources. The FBR said imposition of sin tax on drinks and cigarettes will further increase their prices and demand for smuggled items at the same time, the sources added.

“The industry of cigarettes and drinks gives billions of rupees taxes annually,” said the sources.

The sources said the ministry of health had started cogitating on alternative options. They said the ministry was mulling over increasing rate of taxes imposed on drinks and cigarettes. “Sales tax and federal excise duty will be significantly stepped up.”

Read More: ‘Sin Tax’ to be imposed on smokers

In December last year, taking another revolutionary measure in the health sector, the government had decided to impose ‘Gunnah Tax’ (Sin Tax) on cigarette smokers across the country.

Sources had said the federal government was excogitating over different options as high-level consultation meetings are underway in this regard.

ARY News correspondent Jahangir Khan had said the centre had decided to levy the sin tax on smoking tobacco. “The earning from this tax would be expended on welfare of masses under Prime Minister National Health Programme,” he had said.

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