Govt plans to tax tractors, pesticides in 2024-25 budget

Proposals to end current tax exemptions could raise costs for farmers, aiming to generate Rs30 billion in additional revenue

The federal government may introduce a sales tax on tractors and pesticides in the 2024-25 budget. 

Currently, under the Sixth Schedule of the Sales Tax Act, pesticides and their active ingredients that are registered with the Department of Plant Protection (APP) under the Agricultural Pesticides Ordinance of 1971 are exempt from sales tax. However, this exemption might be removed in the next fiscal year.

Tractors, including electric prime movers for semi-trailers, are currently zero-rated for sales tax. The proposal under consideration suggests applying a reduced sales tax rate to both tractors and pesticides.

As per a news report, these measures are part of the Federal Board of Revenue’s (FBR) budget proposals, influenced by recommendations from the International Monetary Fund (IMF). 

Although these proposals are preliminary, if Parliament approves them, FBR anticipates generating an additional Rs30 billion in tax revenue.

The removal of these exemptions, as proposed, is expected to raise the costs of tractors and pesticides, thereby increasing the financial burden on farmers.

Monitoring Desk
Monitoring Desk
Our monitoring team diligently searches the vast expanse of the web to carefully handpick and distill top-tier business and economic news stories and articles, presenting them to you in a concise and informative manner.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Must Read

Pakistan’s current account records $270 million deficit in May 2024

Pakistan's current account showed a deficit of $270 million in May 2024, contrasting sharply with April's revised surplus of $499 million, according to data...