Pakistan new rumours of rise in GST to 17%

Fri 14th Jun 2013

A fresh round of rumours has started in Pakistan surrounding a potential rise in the Goods & Services Tax (GST) from 16% to 17%.  There have been many such proposals over the past two years as the country attempts to control its national deficit.

In addition to increasing the Pakistan GST rate to 17%, it has been suggested that a wider range of goods would be reclassified at the higher, standard rate.  These would include some basic foods and household goods.

The Pakistan Federal Board of Revenue has regularly come under pressure from the International Monetary Fund to improve its GST system, including widening the tax base.  There are proposals for a complete overhaul, and the introduction of an OECD-based VAT regime.  This would mirror similar planned reform of the Indian VAT system.