The proposal to introduce a 16 percent VAT charge on banking and insurance services while raising the excise rate on fees charged on bank cash transfers to 20 percent from 15 percent has been opposed by the sectors.
The VAT on financial services will hit telegraphic money transfer services, issuance of credit and debit cards, foreign exchange transactions, cheque processing and issuance of securities for money, including bills of exchange and promissory notes.
