Federal Budget 2023-24: Tax on luxury items to remain unchanged

ISLAMABAD: The federal government is likely to keep a 25% sales tax on luxury items in the FY2023-24 federal budget, ARY News reported, citing sources. 

The federal government is set to announce the FY2023-24 budget tomorrow with a total outlay exceeding Rs13,800 billion.

In February, the government slapped 25pc tax on luxury items in the mini-budget and now it has decided to make it part of the Finance Bill.

The federal government is expecting to generate Rs45 to 55 billion in revenue from the sales tax on luxury items, sources said.

They further say the government is considering increasing duty on mobile, worth more than 500 dollars in the next budget.

The government is likely to keep 25pc sales tax on imported electronic items. 25 sales tax will remain intact on the imported cosmetic items for women including lipstick, mascara, face powder, hairdryers, hair straighteners, hair colours, hair vitamins, bleach cream, hair removal cream and others.

Read more: Budget 2023-24: Rs102.86b likely to be allocated for power sector

The sources said that a 25% sales tax will be kept on luxury items including, imported branded shoes, branded purses, imported sunglasses and perfumes, branded headphones, iPods and speakers, imported doors and windows, imported bath fittings, imported tiles, and sanitary, sunglasses, shampoo, soaps, lotions, shaving gels, lights, carpets and others.

25% sales tax will remain enforced on the imported spring mattress, pillows, mineral water, imported cars, chocolates, imported candies, toffees, imported frozen fish, mushrooms and others.

Sources reported that sales tax on imported electronics items, imported make-up goods,  imported pet food and other items will remain at 25%.