ISLAMABAD: The government of Pakistan has initiated measures to address structural and taxation challenges in the country’s dairy sector, focusing on lowering the general sales tax (GST), improving productivity, and formalizing industry practices.
Officials are evaluating proposals to reduce the sales tax on dairy products from 18 percent to 10 percent, a move expected to ease costs for consumers while encouraging greater compliance among producers and distributors.
Tax relief and financial access targeted to strengthen dairy supply chain
Federal Minister for Commerce Jam Kamal Khan chaired a high-level meeting with representatives from the Pakistan Dairy Association to review key obstacles facing the sector. The delegation, led by Chief Executive Officer Dr. Shehzad Amin, highlighted concerns related to high taxation, limited financial services, and productivity gaps among dairy farmers. Meanwhile Rana Ihsaan Afzal joined the session virtually alongside senior officials from the Ministry of Commerce.
During the discussion, participants emphasized the importance of expanding access to banking and financial support for farmers to modernize operations and improve efficiency. Therefore policymakers are considering targeted financial programs and incentives designed to help small-scale producers transition into formal business structures while maintaining stable milk supplies nationwide.
Regulatory reforms and pilot projects aim to modernize the dairy industry
Officials also outlined plans to enhance livestock productivity through genetic improvement programs, which experts consider essential for increasing milk yields and strengthening long-term food security. Additionally the reform package proposes stricter regulatory enforcement to ensure that only pasteurized or properly packaged milk reaches consumers, thereby improving public health standards and product quality.
Furthermore authorities intend to launch pilot projects in major urban centres to test new regulatory frameworks and business models before expanding them nationwide. As a result the government aims to gradually shift the dairy sector toward a more organized and transparent system that supports sustainable growth. The commerce minister directed officials to prepare a comprehensive proposal and coordinate closely with provincial governments to ensure effective implementation of reforms across the country.
