ISLAMABAD: Federal Finance Minister Ishaq Dar has acknowledged that two per cent added sales tax on auto parts may result in the hike of car prices, ARY News reported.
Ishaq Dar called on a delegation of Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM) in Islamabad on Monday.
Speaking on the occasion, the Minister admitted that the imposition of extra tax at rate of 2 per cent on sales of auto parts to the automobile manufacturers by auto parts manufacturers constitute a hardship for the automobile industry and may have the undesired effect of escalation in the prices of the vehicles.
"The extra tax at rate of 2 per cent was imposed to collect sales tax on the value addition made by the distributors, wholesalers and retailers of auto parts from the auto parts manufacturers as the traders in the downstream supply chain were mostly out of the sales tax net", he added.
Meanwhile, Usman Malik, Chairman of PAAPAM gave a detailed presentation to Ishaq Dar on the current status of Pakistan Automobile Industr. He informed the Minister that uncertainity in FBR's NRO will result in the increase in price.