Failure to provide fiscal relief to poultry sector could lead to higher food prices: PPA

LAHORE: The Pakistan Poultry Association (PPA) has voiced serious concerns over the Federal Budget 2026-27, warning that the government’s failure to provide fiscal relief to the poultry sector could lead to higher food prices, reduced investment, lower export competitiveness and increased pressure on food security.

PPA Chairman Abdul Basit, Vice Chairman Malik Muhammad Sharif, and senior members Dr FM Sabir and Khalique Arshad while commenting on the budget expressed disappointment that several longstanding taxation issues affecting the poultry industry remained unresolved despite repeated assurances from policymakers.

The association urged the federal government to revisit taxation measures impacting the sector before the Finance Bill is approved by Parliament, arguing that the continuation of multiple taxes on key production inputs would further inflate poultry production costs and ultimately burden consumers.

The PPA noted that the poultry industry is among Pakistan’s largest and most organized agro-based sectors, playing a critical role in food security, employment generation, rural economic development and the provision of affordable animal protein. The sector also possesses significant potential to earn foreign exchange through exports of value-added poultry products.

However, poultry sector leaders maintained that instead of facilitating growth and investment, the federal budget has retained several taxes that continue to undermine the industry’s competitiveness.

Among its key concerns, the PPA highlighted the continuation of the Rs10 Federal Excise Duty (FED) on every day-old chick, describing it as economically unjustified. According to the association, since day-old chicks represent the first stage of poultry production, the tax directly increases farming costs and ultimately raises poultry prices for consumers.

The association also criticized the 18 percent sales tax on processed chicken, calling it a major obstacle to investment in modern poultry processing facilities. It argued that the levy discourages hygienic and value-added food production, penalizes documented businesses and makes processed poultry products less affordable.

The PPA further expressed concern over import duties and sales taxes imposed on essential poultry feed ingredients, including soybean meal, vitamins, minerals, amino acids and other micro-ingredients. Since feed accounts for nearly 70 to 75 percent of total poultry production costs, higher taxation on these inputs significantly increases the cost of poultry meat and eggs, it said.

“The poultry sector is the backbone of Pakistan’s affordable animal protein supply,” the association said, adding that industry representatives had remained engaged with government officials for months and were repeatedly assured that longstanding taxation anomalies would be addressed in the budget.

“Unfortunately, the final budget has failed to deliver on those commitments, creating uncertainty for investors and stakeholders across the industry,” it added.

The association argued that imposing excessive taxes on primary food production at a time when Pakistan is seeking to curb food inflation, attract investment and expand non-traditional exports is counterproductive. Higher production costs, it said, weaken consumers’ purchasing power and reduce Pakistan’s competitiveness in regional and international poultry markets.

The PPA warned that if corrective measures are not taken, the industry could face further increases in production costs, slower expansion, lower investment and diminished export opportunities, affecting millions of consumers and thousands of livelihoods linked to the poultry value chain.

The association appealed to the Prime Minister, the Finance Minister and the Federal Board of Revenue (FBR) to urgently review the Finance Bill and withdraw the Rs10 FED on day-old chicks, rationalize or abolish the 18 percent sales tax on processed chicken, and reduce customs duties and sales taxes on essential poultry feed ingredients and raw materials.

According to the PPA, such measures would help reduce production costs, stabilize poultry prices, encourage investment, strengthen food security, generate employment and enhance Pakistan’s export potential in the poultry sector.

Copyright Business Recorder, 2026