LAHORE: The formal packaging juice industry has urged the government to take immediate measures in the next federal budget, requesting a significant cut in the Federal Special Tax (Fed).
The juice industry is asking for an substantial reduction in the Federal Tax (FED), which was introduced in 2023 at a rate of 20 percent, aggravated by a general general sales tax (GST). According to a spokesman for the Fruite Juice Council, this combined burden is severely affecting the documented sector and leading to serious economic repercussions.
The sector, which expected sales greater than RS72 billion in fiscal year 23, witnessed a 45 percent drop to RS42bn. This has stagnated the growth of the industry and has resulted in a considerable deficit in government income projections for the current fiscal year.
The exorbitant tax burden, effectively promoting the fiscal component in a juice package to about 42 % of its price, has fundamentally affected the affordability of the consumer.
This has inadvertently fed an alarming increase in the undocumented sector, which offers cheaper, low quality and potentially insecure alternatives that evade all tax obligations, he says.
The industry states that the repercussions extend beyond the results of the industry. The drastic reduction in demand for the formal sector has severely impacted the rural economy, particularly fruit farmers. At its peak, the industry obtained more than 100,000 tons of fruit annually from local producers.
Posted in Dawn, on May 25, 2025
