KARACHI: Small farmers from Sindh have formally requested the Federal Board of Revenue (FBR) to reduce the customs duty on imported tractors from 15% to 5% as part of a broader tariff rationalization plan set for the 2025-26 budget. This initiative aims to support the agriculture sector, which is facing numerous financial challenges.
In a proposal submitted to FBR Chairman Rashid Mahmood, farmers have also called for a reduction in the existing sales tax rate on both locally manufactured and imported tractors, dropping it from 14 percent to 5 percent. The request is not for an exemption, but for a reduced rate similar to those applied to other items, including vehicles, under the Sales Tax Act.
The Sindh Chamber of Agriculture (SCA) in Hyderabad, which represents the farmers, has presented these budget proposals to help ease the financial strain on the farming community. According to sources within FBR, the proposals are currently under review as part of the ongoing budget preparation process.
Nabi Bux Sathio, Senior Vice President of the Sindh Chamber of Agriculture, expressed concern over the difficulties farmers have faced due to the lack of adequate support and investment in the sector.
He noted that agriculture, which contributes significantly to Pakistan’s GDP and employs a large portion of the workforce, is struggling with a range of challenges, including climate change, water scarcity, and poor pricing for produce.
The SCA’s budget proposals also include suggestions for a broader overhaul of the tax structure, including the elimination of the Additional Customs Duty (ACD), the phasing out of Regulatory Duty (RD), and a restructuring of the customs tariff to address the challenges faced by the agriculture sector.
The Sindh Chamber of Agriculture has called on the FBR to address these issues by reducing the custom duties and sales tax on tractors, making it easier for farmers to purchase the necessary equipment to enhance productivity.
