Govt reviews plan to cut GST to 10% for dairy products

April 13, 2026 (MLN):  The government has moved to address key structural and taxation challenges in Pakistan’s dairy sector, focusing on reducing GST, improving productivity, and formalizing the industry.

 Officials are working on proposals to lower sales tax on dairy products from 18% to 10%, alongside broader reforms aimed at improving genetic quality of livestock, expanding access to banking and financial support for farmers, and introducing stricter regulatory measures to ensure the availability of only pasteurized or properly packaged milk.

The plan also includes pilot projects in major cities to help transition the sector toward a more organized, formal business model, according to a press release issued.

Federal Minister for Commerce Jam Kamal Khan chaired a meeting with a delegation of the Pakistan Dairy Association led by CEO Dr. Shehzad Amin. The session was also attended virtually by Rana Ihsaan Afzal, along with senior officials from the Ministry of Commerce.

The meeting reviewed the challenges facing the dairy sector, particularly taxation, productivity gaps, and the need for genetic improvement in livestock.

During the meeting, the minister stressed that improving genetic quality and guiding farmers toward a structured, formalized business model is essential for increasing milk yields and overall sector efficiency.

The Pakistan Dairy Association presented its recommendations, including tax relief, better financial access for farmers, and stronger regulatory enforcement.

The minister directed the preparation of a detailed proposal and said he would engage relevant provincial authorities to ensure coordinated implementation of reforms aimed at strengthening the dairy sector’s long-term growth.

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