Tax Introduced on Herbal and Homeopathic Medicines
Islamabad: The federal government has agreed to another demand from the International Monetary Fund (IMF) by eliminating tax exemptions on herbal
Islamabad: The federal government has agreed to another demand from the International Monetary Fund (IMF) by eliminating tax exemptions on herbal and homeopathic medicines, imposing an 18% sales tax on these products, as reported by ARY News on Wednesday.
Documents obtained by ARY News reveal that the government will implement an 18% sales tax on herbal and homeopathic medicines, including those used for treating ailments such as coughs, colds, and flu. The tax will also extend to herbal supplements, serums, and creams.
The imposition of sales tax on herbal and homeopathic medicines will be executed under the 8th schedule of the Sales Tax Act. Additionally, herbal potions, jams, and saffron will also be subject to an 18% sales tax, according to the documents.
This decision is expected to raise the prices of herbal and homeopathic medicines, potentially increasing costs for consumers.
The IMF had recommended that Pakistan impose a 18% General Sales Tax (GST) on essential items such as food, medicine, petroleum products, and stationery.
IMF experts, in their report dispatched to Islamabad following a visit in December 2023 and submission in February 2024, emphasized ending sales tax exemptions as part of broader fiscal measures for the FY2024-25 budget.
Addressing the National Assembly during the budget session, Prime Minister Shehbaz Sharif acknowledged the necessity to align the FY2024-25 budget with IMF recommendations. He expressed optimism about receiving a favorable response from the IMF, indicating readiness to present the budget accordingly.
