In the new federal budget 2024-25, the government has proposed an 18 percent sales tax on milk and fat-filled milk, which are presently zero-rated. The proposal also includes taxing infant milk items not exceeding Rs. 600 per 200g at the same rate. If approved, these taxes are expected to generate approximately Rs. 95 billion in revenue, with Rs. 75 billion from standard milk and Rs. 20 billion from infant milk. Finance Minister Muhammad Aurangzeb, speaking at a post-budget briefing, stated that the middle class should not face significant difficulties in paying the 18 percent sales tax on milk products. The revenue generated from the tax on standard milk equals the budget allocated for parliamentary schemes for the new fiscal year. With the implementation of the 18 percent sales tax, the price of milk is anticipated to increase from Rs. 290 to Rs. 342 per liter.
