Open AccessThe Determinants of Rates of Octroi Tax in Pakistan
Author(s) -
Aisha Ghaus,
Rauf Ahmed Khan,
Rafia Ghaus
Publication year - 1995
Publication title -
pakistan development review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.154
H-Index - 26
ISSN - 0030-9729
DOI - 10.30541/v34i4iipp.809-829
Subject(s) - revenue , tax revenue , business , agricultural economics , consumption (sociology) , situated , total revenue , value added tax , sales tax , economics , ad valorem tax , finance , public economics , double taxation , social science , artificial intelligence , sociology , computer science
Octroi is a tax imposed by local governments in Pakistan oncommodities imported into the municipal limits for local use, sale, orconsumption. It is levied generally by urban local councils on goodscoming in by all modes-sea, land, and air transport. The point ofassessment is alongside roads at octroi posts situated at or beforemunicipal boundaries, at railway stations, seaports or airports. Octroiis currently the largest source of revenue to urban local councils inthe country and contributes 86 percent to total tax revenues and over 59percent to total local revenue receipts (see Table I). Its revenuesignificance (in terms of share in total receipts) has increased overthe years. In 1987-88, it accounted for about 57 percent of total localreceipts. Also, revenue generation from octroi is higher than that byany provincial tax. In 1991-92, total national collection from octroiwas Rs 5.5 billion as compared to Rs 3.5 billion from stamp duties, thelargest provincial tax source.