Govt. removes ACDs on 4000 TLs reduces on 2,700 more: FM

ISLAMABAD: Finance Minister Senator Muhammad Aurangzeb announced on Wednesday that the government has eliminated additional customs duties on 4,000 out of 7,000 total tariff lines and reduced duties on another 2,700.
Speaking at a post-budget press conference—which was notably boycotted by journalists due to the Federal Board of Revenue’s (FBR) conduct on budget day—the finance minister described the tariff rationalisation as a “major and important step” toward aligning Pakistan’s trade and industrial policy with global standards. He said the initiative marks the beginning of a phased plan to transition towards a simplified tariff structure, with a goal of achieving more than a 4% reduction in the overall tariff regime.
“Overall, there are 7,000 tariff lines. Additional customs duties have been removed on 4,000 lines, and reduced on 2,700,” Aurangzeb explained. “Of these, around 2,000 tariff lines are directly linked to raw materials and intermediary goods used by exporters.”
He stressed that lowering input costs for exporters would enhance their competitiveness in international markets—an essential factor as Pakistan seeks to expand its export base and reduce the trade deficit.
“This is a structural reform that hasn’t been undertaken in the past 30 years,” he said. “From a reform perspective, this is a significant step, and we are committed to continuing it gradually.”
In response to a question, Aurangzeb said that additional revenue measures amounting to up to Rs 500 billion may be introduced in the next fiscal year if the necessary amendments and enforcement legislation are not passed by Parliament, as all budgetary targets have been locked in consultation with the International Monetary Fund (IMF).
He called for parliamentary support on enforcement measures to bridge the fiscal gap, noting that GST on fertilizers was not imposed following renegotiations with the IMF.
“We have two options—either ensure enforcement or introduce additional measures worth Rs 400 to 500 billion. That’s why we are seeking Parliament’s help for enabling amendments and legislation,” he said.
When asked about the federal government’s reported plan to delink population from the National Finance Commission (NFC) award, the minister stated that all decisions, including those related to the national fiscal pact, would be made in consultation with the provinces. He noted that provinces are projected to receive a record Rs 8.2 trillion from the federal divisible tax pool in the upcoming fiscal year.