Pakistan's New Milk Tax Drives Prices Higher than Paris
Source: The DairyNews
Karachi's Milk Prices Exceed Those in Paris Following New Taxation Measures
Milk prices in Pakistan have skyrocketed by over 20% after the government imposed a new tax, making this essential commodity more expensive in Karachi than in several developed nations, including France and Australia.
In Karachi, ultra-high temperature (UHT) milk now costs 370 rupees ($1.33) per liter, surpassing the prices in Amsterdam ($1.29), Paris ($1.23), and Melbourne ($1.08), according to Bloomberg data. This surge follows an 18% tax applied to packaged milk, a change introduced in the recent national budget. Previously, packaged milk was exempt fr om taxes.
Before this tax hike, milk prices in Pakistan were comparable to those in developing countries such as Vietnam and Nigeria, explained Muhammad Nasir, spokesman for the local unit of Dutch dairy giant Royal FrieslandCampina NV. The new tax has pushed retail prices up by as much as 25%.
The increase in milk prices is expected to exacerbate the ongoing inflation in Pakistan, wh ere stagnant wages have already diminished purchasing power. This could also have severe implications for child health, in a country where nearly 40% of the population lives in poverty.
"This tax will deprive nutrition to an already malnourished population," Nasir stated in a message. Approximately 60% of Pakistani children under five suffer from anemia, and 40% are affected by stunting.
The tax hike is part of a broader budgetary effort to meet the stringent conditions set by the International Monetary Fund for a new bailout, with overall taxes raised by 40%, marking the highest increase on record.
In Karachi, ultra-high temperature (UHT) milk now costs 370 rupees ($1.33) per liter, surpassing the prices in Amsterdam ($1.29), Paris ($1.23), and Melbourne ($1.08), according to Bloomberg data. This surge follows an 18% tax applied to packaged milk, a change introduced in the recent national budget. Previously, packaged milk was exempt fr om taxes.
Before this tax hike, milk prices in Pakistan were comparable to those in developing countries such as Vietnam and Nigeria, explained Muhammad Nasir, spokesman for the local unit of Dutch dairy giant Royal FrieslandCampina NV. The new tax has pushed retail prices up by as much as 25%.
The increase in milk prices is expected to exacerbate the ongoing inflation in Pakistan, wh ere stagnant wages have already diminished purchasing power. This could also have severe implications for child health, in a country where nearly 40% of the population lives in poverty.
"This tax will deprive nutrition to an already malnourished population," Nasir stated in a message. Approximately 60% of Pakistani children under five suffer from anemia, and 40% are affected by stunting.
The tax hike is part of a broader budgetary effort to meet the stringent conditions set by the International Monetary Fund for a new bailout, with overall taxes raised by 40%, marking the highest increase on record.
