ISLAMABAD: The Federal Board of Revenue (FBR) has increased the sales tax on both locally supplied and imported tea.
As per details, the FBR has established a minimum retail price of Rs. 1,200 per kilogram, raising the current sales tax rate on tea from 17% to 18%.
The decision was made during a recent meeting of the Economic Coordination Committee (ECC) and is part of the government’s broader strategy to enhance revenue collection.
Under the new regulations, formalized through S.R.O. 1735(1)/2024, the sales tax on tea will rise to 18% from the previous rate of 17%.
According to the notification, the FBR has invoked its authority under the first proviso to clause (46) of section 2 of the Sales Tax Act, 1990, to fix price for tea classified under heading 09.02 of the First Schedule to the Customs Act, 1969.
Reports indicate that the FBR’s move is expected to affect the pricing of tea, which is a staple beverage in Pakistan and is consumed daily by millions.
The increase in sales tax on tea comes amid ongoing efforts to boost the national revenue base and manage financial challenges.
Officials have stated that the new tax rate will be implemented immediately, and they expect that it will contribute to the government’s revenue goals.
The International Monetary Fund (IMF) has demanded a mini-budget as the federal government failed to address IMF conditions including achieving tax targets in the current fiscal year.
