The Sindh government has announced an increase in the rate of provincial sales tax on services by 2 percentage points, raising it to 15% effective from July 1.This move is expected to exacerbate inflation as it is an indirect tax that disproportionately affects low-income groups. The government estimates that this hike will generate an additional Rs120 billion, bringing the total SST collection to Rs350 billion for the fiscal year 2024-25.
Additionally, the government has aggressively increased the rate of professional tax on personal income and some services by 300%, raising it to Rs2,000 per year. Taxes on imported and locally manufactured vehicles have also been significantly increased by up to Rs450,000
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