Govt to Reconsider 18 percent GST on Packaged Milk, Dairy Industry Awaits Relief

The federal government is considering reevaluating the 18% General Sales Tax (GST) on packaged milk to encourage investment and strengthen the dairy sector, as per Federal Minister for National Food Security and Research, Rana Tanveer Hussain.

This development was revealed during his discussion with the Pakistan Dairy Association (PDA) on Thursday. The PDA representatives shed light on various difficulties faced by the dairy industry, including the financial burden on processors and farmers due to the existing tax.

A statement from the Press Information Department highlighted that the taxation policy has resulted in increased consumer prices and discouraged investment in dairy farming, ultimately impacting milk production.

Minister Hussain recognized Pakistan’s status as a key global milk producer, with an annual yield exceeding 70 million tonnes. However, he stressed that unlocking the industry's full capabilities requires strategic investments and well-crafted policy amendments. He assured the delegation of the government’s commitment to creating an investment-friendly environment to boost milk production and enhance quality standards.

The PDA urged policymakers to reconsider the tax, emphasizing its adverse effects on affordability and sectoral expansion. In response, Minister Hussain affirmed that the Ministry of National Food Security and Research would collaborate with key stakeholders to devise industry-supportive solutions.

He further stated that any proposed tax adjustments would be structured to ensure direct benefits for both consumers and dairy farmers.

Additionally, the minister reiterated the need to modernize Pakistan’s dairy industry to align with international standards, enhance competitiveness, and attract foreign investment. He stressed that achieving food security and self-sufficiency remains an ongoing challenge without sectoral advancements.

The government, he added, is dedicated to stabilizing milk prices and ensuring long-term industry growth through continuous discussions with relevant stakeholders.