The Federal Board of Revenue (FBR) has granted major tax exemptions to the Trading Corporation of Pakistan (TCP) and the private sector for the import of 500,000 metric tons of sugar.
The FBR’s latest decision includes an exemption from customs duty on the specified quantity of sugar, alongside a reduction in the sales tax rate, which has been cut from 18% to 0.25%. Additionally, the withholding tax has been reduced to 0.25% on sugar imports by both the Trading Corporation of Pakistan (TCP) and the private sector.
In a series of notifications issued on Wednesday — SRO.1215(I)/2025, S.R.O. 1216(I)/2025, and SRO.1217(I)/2025 — the FBR also waived a 3% minimum value-added tax (VAT) on the import of up to 500,000 metric tons of sugar. These changes apply to both commercial imports of crystalline sugar, with specific conditions attached.
The revised tax and duty exemptions are designed to facilitate sugar imports through TCP or the private sector, with a deadline for the imports set for September 30, 2025. The Commerce Division will oversee the process, ensuring quality assurance via an international inspection firm. The move follows the Cabinet’s approval to ensure the availability of sugar at competitive prices.
On July 8, the federal cabinet approved the import of 500,000 tons of sugar in a bid to address supply gaps and stabilise prices amid growing concerns over inflation and commodity shortages.
The Ministry of National Food Security and Research said that the sugar will be procured through the government sector, with arrangements already underway to begin the import process immediately.
The decision follows a recent high-level meeting chaired by Finance Minister Ishaq Dar, during which earlier recommendations to import sugar were endorsed. Officials described the move as a precautionary measure to ensure availability and prevent a potential price spike.
A spokesperson for the food security ministry said the government’s strategy this year departs from past approaches, avoiding both export-led shortages and subsidy-driven imports. “This is a calibrated intervention based on actual need,” the spokesperson stated.
