The federal government is thinking about adding a new tax called Federal Excise Duty (FED) on many popular packaged food items in the budget for the year 2026. These items include biscuits, cakes, sweets, chips, sauces, and even ice cream.
According to industry experts, this new tax could help the government collect as much as Rs150 billion in revenue. Out of this total, biscuits and sweets alone are expected to bring in more than Rs95 billion.
The main goal of this plan is to increase the number of people and businesses that pay taxes, without putting extra pressure on everyday essential items like basic groceries. Instead, the government is focusing on food items that are widely consumed but currently not taxed.
This proposal is also in line with the advice given by the International Monetary Fund (IMF), which has recommended that Pakistan take steps to improve its income from within the country. By following this suggestion, the government hopes to create a more balanced and fair budget while also making sure that people who can afford to pay more are the ones being taxed.
More details about this plan, including whether it will be approved, are expected to be shared when the official federal budget is presented in June.
