Govt extends VAT exemption on metro rail tickets for six more months

Excise duty for Hajj pilgrims is also likely to be lifted from next year’s Hajj journey

The value-added tax (VAT) exemption imposed on metro rail tickets last year has been extended by six more months.

The extension means metro passengers can commute for the time at the current fare.

The government has also decided to fully withdraw the excise duty on air tickets for next year’s Hajj pilgrims.

National Board of Revenue (NBR) Chairman Md Abdur Rahman Khan confirmed the decision had been taken in principle. An order in this regard is likely to be issued soon.

NBR imposed VAT on metro rail tickets at the beginning of the last fiscal year. But passengers never had to pay, as authorities never came up with a plan to realise it. NBR had to waive it eventually.

An inter-ministerial technical committee had been formed to sort out a way of collecting the VAT. But the technical committee had failed to resolve the matter.

The NBR had said the VAT exemption will remain in effect until Dec 31 to “popularise” metro rail even more and ensure affordable travel costs.

Hajj pilgrims, on the other hand, had enjoyed an excise duty waiver last year.

In November last year, the NBR had also waived the 15 percent VAT imposed on passenger embarkation fees, security fees, and airport security fees.