Geo 436 ISLAMABAD: Government of Pakistan is all set to enforce the Value-added Tax (VAT) regime from July 1 across the country amid widespread concerns among economists and traders. The traders said the Tax would directly hit the common man. The FBR is planning to enforce the GST Amended bill as a part of Plan-B under which the existing tax exemptions will be waived off as it seems reluctant to enforce VAT, because its staff is not so far given training on VAT and retailers are also not in a mood to pay VAT, as they have not been educated by the FBR on how to maintain their documents after the VAT is enforced. The VAT would be received in proportion to the value hike in the products and services; thus, the Tax would be included in the price of a product from its production phase to the phase of supply to the consumers. Only the consumer would be bound to pay the price of it all. If 15 percent VAT is enforced, it would entail Rs125 billion in additional revenues in the first year of its promulgation; the Tax would not be applicable to the business that sells less than Rs7.5 million. Federal Board of Revenue (FBR) said the VAT would not push up the prices of edibles, as General Sales Tax (GST) is already imposed on them and some essential commodities i.e. daal and atta would be exempted from it. The economic analysts said VAT is also an indirect tax which would affect common man; contrarily, the government should impose tax on the direct income to receive the revenues. Besides, burden of price hike should be shifted from the poor to tax-evaders by widening the tax net, they urged.
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