KARACHI: The Pakistani government has abolished an 18% sales tax on the shipping industry as part of the federal budget for 2026-27, a move aimed at lowering logistics costs, attracting investment and boosting the competitiveness of the country’s maritime sector.
Federal Minister for Maritime Affairs Muhammad Junaid Anwar Chaudhry welcomed the decision, calling the tax exemption a significant step toward strengthening Pakistan’s maritime and logistics industries.
“The abolition of the 18% sales tax will facilitate trade by lowering transportation and logistics costs,” the minister said in a statement, adding that the measure fulfills a long-standing demand of shipping sector stakeholders.
The removal of the tax burden is expected to create a more attractive environment for domestic and foreign investors in maritime services and shipping operations, according to the minister.
He said the initiative would reduce the cost of doing business for importers and exporters while supporting the growth of local shipping companies.
Lower operational costs, Chaudhry said, would improve supply-chain efficiency and strengthen the competitiveness of Pakistani businesses engaged in international trade.
Industry participants have long argued that high taxation and operational expenses hindered the sector’s growth, limiting its ability to compete in regional and global markets.
The government expects the measure to encourage fresh investment in shipping, logistics and related infrastructure, contributing to the broader development of Pakistan’s maritime economy.
The minister also said the decision would support the expansion of Pakistan’s blue economy by fostering a more business-friendly environment for maritime activities, potentially generating employment in shipping, port operations and logistics.
The tax relief forms part of the government’s broader strategy to facilitate business activity, promote investment and support economic growth through targeted fiscal reforms in Budget 2026-27.
