Fertilisers and Pesticides to Remain Tax-Free in Budget 2025-26

In a move to support farmers grappling with high input costs, the federal government has decided to retain the tax exemption on fertilisers and pesticides in the upcoming Budget 2025-26, providing temporary relief to Pakistan’s struggling agriculture sector.

As part of its negotiations with the International Monetary Fund (IMF), the government has secured a one-year extension for the tax exemption on fertilisers and pesticides. This relief measure aims to ease cost pressures on farmers already hit hard by inflation, climate-related crop challenges, and volatile market prices.

Despite introducing various new tax measures across multiple sectors, the federal government has chosen to exempt key agricultural inputs to protect food production and rural livelihoods. This move is expected to encourage sustained agricultural activity while insulating the sector from the broader fiscal tightening under the IMF programme.

The tax exemption on fertilisers and pesticides in Budget 2025-26 is expected to help farmers manage production costs, especially ahead of the next sowing season. The relief also complements the government’s broader goal to ensure food security and stabilize prices for essential crops.

While other sectors brace for increased tax burdens, the agriculture sector will benefit from this critical exemption in the upcoming fiscal year, reinforcing the government’s commitment to support domestic food production and rural income stability.