ISLAMABAD: The Pakistan Dairy Association (PDA) has urged the government to reduce general sales tax (GST) on dairy products from 18 percent to five percent, saying that imposition on a hefty GST has forced the industry to cut milk purchase from farmers by 20 percent which has also resulted in the closure of various milk collection centres in the country.
The representatives of PDA in a presentation to the Special Assistant to the Prime Minister (SAPM) Haroon Akhtar Khan, here on Wednesday, said that no other market in the world has such kind of taxation on dairy industry.
During the meeting, PDA and SAPM also discussed the challenges being faced by the dairy sector and explored possible solutions.
One of the key topics of discussion was the impact of the 18 per cent GST on packaged milk. Haroon Akhtar Khan stated that this tax has led to an increase in milk prices, affecting both producers and consumers.
The PDA urged the government to reconsider the taxation policy on packaged milk, advocating for a reduction in GST to ensure a steady supply of milk at affordable prices for consumers while supporting the dairy sector.
According to the dairy industry, owing to heavy taxation on dairy products farmers are also suffering as a reduction in usage by end consumers has a direct impact on the milk producers and other relevant sectors.
During the meeting, the PDA delegation also informed the SAPM that Pakistan with enabling policies can enhance dairy related exports to $150 million within three years.
Haroon Akhtar Khan highlighted that Pakistan is among the world’s largest milk-producing countries, with an annual production of over 70 million tons. However, he emphasised the need for further development in dairy farming and milk processing industries to improve quality standards and reduce production costs.
Haroon Akhtar Khan stressed that without increased investment in the dairy sector, achieving self-sufficiency in food production would not be possible.
He assured the delegation that the government is committed to addressing the challenges of the dairy industry and will continue engaging with relevant stakeholders to find effective solutions.
Copyright Business Recorder, 2025
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