FBR concludes revision of GST schedules for upcoming budget M Haris

ISLAMABAD: The Federal Board of Revenue (FBR) has completed the revision of the sales tax schedules, specifically the Sixth Schedule (Exemption list) and the Fifth Schedule (zero-rated goods), under the Sales Tax Act, 1990, in preparation for the upcoming budget for fiscal year 2024-25.

It has been learned that the number of goods exempted under the Sixth Schedule and zero-rated items under the Fifth Schedule will be significantly reduced as proposed in the Finance Bill 2024. These items will now be subjected to the standard sales tax rate of 18% in the forthcoming budget.

However, exemptions will continue for diplomats, medical and health-related items, and foreign investments, including Chinese projects, in accordance with existing government agreements.

The budget planners have meticulously reviewed the complete list of zero-rated and sales tax-exempted items to expand the scope of taxable goods. Consequently, it is proposed that the local supply of numerous items will no longer enjoy sales tax exemption.

According to sources, many items currently enjoying a zero percent sales tax rate under the Sales Tax Act 1990 will be subjected to an 18 percent sales tax rate. A substantial number of items are expected to be removed from both the Sixth Schedule (Exemption Schedule) and the Fifth Schedule (Zero-Rated Schedule) as part of the proposed Finance Bill 2024.