Govt announces major tax reductions

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President Dr. Irfaan Ali

President Dr. Irfaan Ali has announced a variety of measures that will be implemented by the new government, geared to sectors ranging from medical to construction.

During a press conference on Monday, President Ali announced that VAT will be reversed on electricity and water.

He also announced that VAT will be removed from all medical supplies, not just on supplies related to COVID-19.

In addition, corporate tax will be removed from private healthcare and private education. On this note, the Head-of-State urged these private institutions to look at the issue of costs for these services, given that corporate taxes will now be removed.

According to Ali, the new administration will also remove VAT on construction materials and cellphones, fulfilling a major campaign promise the party made in the run up to the elections.

He also announced the removal of VAT and duties on machinery and equipment, a measure intended to recapitalise industries such as mining and agriculture.

VAT will also be removed on fertilizers, agro chemicals and other materials. When it comes to exports, VAT will also be reversed.

Land lease fees will also be reversed, President Ali said, noting that it will help almost all the segments in the population connected to food production.

VAT will also be removed on hinterland travel.

He also said the ban on the importation of vehicles older than eight years has also been reversed.

The PPP/C government is slated to present a national emergency budget on Wednesday.

[This is a developing story]