Pakistan Considers Reducing GST on Dairy Products to Boost Sector

The Federal Minister for Commerce in Pakistan, Jam Kamal Khan, has proposed a reduction in the general sales tax (GST) on dairy products from 18% to 10%. This initiative aims to provide significant tax relief and support to the country's dairy sector.

During a meeting chaired by Jam Kamal with the Pakistan Dairy Association (PDA), led by CEO Dr. Shehzad Amin, various challenges facing the sector were discussed. These included tariff and taxation issues, as well as the need for improving productivity and the genetic quality of dairy breeds. Coordination efforts were also joined by Rana Ihsaan Afzal, Coordinator to the Prime Minister on Commerce, along with senior officials from the Ministry of Commerce.

The PDA highlighted that globally and in neighboring countries, dairy products often enjoy zero or minimal taxation, contrasting with the current 18% GST in Pakistan. In response, Jam Kamal directed the PDA to prepare proposals for reducing the GST to 10% and asked Rana Ihsaan Afzal to collaborate closely with the association to develop a comprehensive plan.

Additional proposals from the association included financial support and banking facilities for farmers, regulatory measures to ensure only pasteurised or properly packaged milk is sold, and the initiation of pilot programs in major urban centers to transition farmers into formal business practices. They also emphasized the importance of cross-breeding programs and farmer training to enhance genetic quality and increase milk production.

Jam Kamal expressed support for these initiatives and stressed the importance of a comprehensive plan for timely implementation. He also mentioned his intention to write to chief ministers and relevant ministers to ensure coordination and support for these proposals, aiming for improved regulatory compliance and higher productivity in the dairy sector.