In the Budget 2025-26 to encourage local manufacturing of solar panels, the government has proposed to impose 18% sales tax on the import of solar panels.
In a significant policy shift, the government has announced a uniform 18% sales tax on small vehicles up to 850cc, replacing the previously lower tax rates applied to certain models. This measure aims to standardize taxation across petrol, diesel, and hybrid vehicles, ensuring a more consistent and transparent tax structure.
The government has also proposed to impose additional levy on the import and purchase of cars with petrol and diesel engines.
The government has introduced a carbon levy of Rs.2.5 per liter on petrol, high-speed diesel, and furnace oil to discourage fossil fuel consumption and promote cleaner energy alternatives. This levy will double to Rs.5 per liter from the fiscal year 2026-27, signaling a stronger commitment to environmental sustainability. Additionally, a petroleum levy on furnace oil will be imposed as per the government’s announcement, further reinforcing efforts to shift towards greener energy sources. These measures are expected to impact fuel prices while generating revenue for climate initiatives and sustainable energy projects.
The government has also decided to refinance the current expensive government debts of power sector through cheap and Sharia compliance bank financing to avoid extra expenditures.
To enhance tax compliance in the digital economy, the government has proposed new taxation measures for online businesses and e-commerce platforms. Under this policy, platforms facilitating digital transactions will be required to levy taxes on goods and services ordered online, ensuring that all digital sales contribute to the national tax framework. Additionally, businesses operating on these platforms must submit monthly transaction data and tax reports.
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