ISLAMABAD Federal Minister for Information and Broadcasting Qamar Zaman Kaira on Tuesday said that through Value Added Tax (VAT) inflation would not increase, as it is not an additional tax and only the replacement of existing GST. He said this while addressing a workshop on How to cover budget. He said, VAT will not only increase the revenues but the economy will also be documented. He said that GST rate is varying in the range of 16 to 25 percent, and under VAT will be at a uniform rate of 15 percent. He further said that under GST majority of the sectors are exempted from the taxes, and these sectors would come under the tax net after the imposition of VAT. The exemptions will be granted to any sector after getting approval from the Parliament, he added. He said that VAT will not affect the small traders as those who are earning up to Rs 7.5 million per year would come under VAT while under GST this limit was Rs 5 million which means that small traders will not get affected through VAT. If we do not generate our own revenue resources in the country then we will have to depend on foreign aids and loans and will also accept their conditionalities, therefore, VAT is compulsory for the economy, he remarked. He said despite several challenges macroeconomic stability is improving due to the governments healthy policies and now the main focus is to improve the trade and fiscal deficits and to also end the power crisis. The government is working to control the soaring inflation and to bring it to the single digit figure and it is the responsibility of the provincial governments to keep balance in prices, he added. In the budget for next fiscal year 2010-11, we are keeping realistic targets, which could be achieved at the end of year, and in this regard PSDP is kept at Rs 280 billion and if we get foreign assistance it will be further enhanced. The government will review the progress of PSDP after four months and would ensure its timely completion, he said. Talking about the countrys debts, he said in the last four years it had been doubled and it is 60 percent of the total GDP which is an alarming situation and We are not in a position to further increase it so we have to depend on our own resources. We would try to bring budget of all the ministries in the relevant National Standing Committees in future to make it more effective, he said.