Retailers will be bound to sell certain imported products on prices determined by the importers according to tax experts interpreting the money bill for the coming fiscal year.
According to these experts, consumers would be able to buy imported products at printed retail prices rather than the prices set by the retailers themselves. This move should also help tax authorities in collecting sales tax.
According to details, the government has made it mandatory for importers to supply certain products with the retail price on them. This can only mean that this price will have to be used by retailers.
The new budget has proposed that sales tax would be collected from importers by the customs authority during clearance, and that the importers would then collect 17% sales tax from the retailers – again leaving no room for the retailers to set their own prices.
This is expected to bring uniformity in the prices of specific items under third schedule of Sales Tax Act 1990 across the country and end the cartelisation of large retail houses in fixing prices.
This sort of regime was already present for imported products such as air conditioners, refrigerators, light bulbs, televisions, deep fryers, tube lights, electric fans, washing machines, and telephone sets.
The list will now be extended to include household gas appliances, such as cooking ranges, ovens, geysers, gas heaters, as well as other thing such as mattresses, paint, oil, storage battery, motorcycles, and auto rickshaws.
Tax officials in the Federal Board of Revenue (FBR) have also said that while importers will have discretion in fixing prices, the administration would keep vigil to discourage inflated prices by bringing commercial importers into minimum tax from final tax regime.
