Pakistan restores 18pc sales tax on imported sugar

Rabbia Zafar | 1 hour ago

Pakistan restores sales tax on sugar imports

The federal government has restored an 18 per cent sales tax on imported sugar, reversing a temporary relief measure introduced in August 2025 to stabilise domestic supply, according to an official notification.

Earlier, the government had reduced the sales tax on imported sugar from 18 per cent to 0.25 per cent as part of a targeted plan to improve availability in the local market. The concession was specifically applied to sugar imported by the Trading Corporation of Pakistan (TCP), which had been tasked with importing 500,000 tonnes of the commodity to manage domestic shortages and price pressures.

Under the latest notification, the reduced tax rate has now been withdrawn, and the standard 18 per cent sales tax has been reinstated on imported sugar. The revised policy took effect from April 22, 2026.

Officials did not immediately provide detailed reasons for the reversal, but such adjustments are typically linked to changing domestic supply conditions, fiscal considerations, and import management strategies.

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The move comes amid a significant rise in sugar imports during the current fiscal year. According to data from the Pakistan Bureau of Statistics, sugar imports surged by over 7,900 per cent in the first seven months of the fiscal year compared to the same period last year. Between July and January, imports exceeded $17.46 million, a sharp increase from $211,800 recorded previously.

In January 2026 alone, sugar imports reached $23.4 million, reflecting a month-on-month increase of more than 46 per cent. Overall food imports also rose significantly, increasing by 7.74 per cent in January and 19.26 per cent over the seven-month period, crossing $5.5 billion in total value.

Other major imported food items included palm oil, tea, and dried fruits, highlighting broader trends of rising food import dependence. The restoration of the tax is expected to impact import costs and may influence market prices in the coming months.