Pakistan’s packaged juice industry is facing major challenges after higher taxes significantly increased product prices and reduced consumer demand.
The sector is currently being affected by the combined impact of 20% Federal Excise Duty (FED) and 18% General Sales Tax (GST), which together have raised the total tax burden to around 42%.
Industry representatives say this sharp increase in taxes has made packaged juices more expensive for consumers. As a result, overall sales have dropped by more than 45% since the tax hike was introduced.
Market value has also declined significantly, shrinking from nearly PKR 60 billion to around PKR 40 billion. Businesses believe this reduction reflects lower affordability and changing consumer purchasing habits.
According to industry stakeholders, high prices are also pushing some consumers toward cheaper, unregulated alternatives in the informal market. This shift is creating concerns about both product quality and the long-term sustainability of the formal juice industry.
To support recovery, industry experts have suggested changes in the upcoming Budget 2026–27. They recommend reducing the Federal Excise Duty on existing juices from 20% to 10%. They also propose introducing a zero-tax category for juices with no added sucrose or white sugar.
They believe these measures would help make packaged juices more affordable, improve sales volumes, and encourage healthier product options for consumers.
Industry officials argue that lowering taxes could also help reduce the size of the informal market by bringing more consumers back to regulated, branded products. This, in turn, could support tax revenue in the long term through higher sales volumes.
