Withdrawal of sales tax on wheat and bran will stop the expected rise in flour prices from July 1, sources said. Photo: File
Islamabad: The federal government has announced the withdrawal of the proposed 17% sales tax on wheat and bran to curb inflation and provide relief to the business community.
In this regard, a statement issued by the Federal Board of Revenue said that the proposed sales tax on wheat and bran has been re-clarified in the Finance Bill 2021 as FMCG (Fast Moving Consumer Goods) products. Including flour mills and refineries, the proposed minimum tax rate table has been changed on a turnover basis to facilitate retailers.
In this regard, the FBR had earlier issued an explanation in which it was explained that in the relevant table in the Finance Bill 2021-22, the words ‘flourmills’ were not written by mistake. This error will be corrected by amending the Finance Bill. This means that the minimum tax levied on flour mills will be 0.25% of the turnover and not 1.25% of the turnover that is being sought.
The FBR further said that the tax on wheat and bran is being withdrawn in the amended finance bill submitted for approval by the parliament. Sources said that the withdrawal of sales tax on wheat and bran by the government would now stop the expected rise in flour prices on July 1.