ISLAMABAD: The All Pakistan Fertilizer Dealers Association (APFDA) has rejected the proposed increase in turnover tax on fertilizer sales, saying the new taxation will further damage Pakistan’s agricultural productivity and add to the economic woes of the farming community.
“We strongly reject the proposed increase in turnover tax on fertilizer sales as any such action would further increase the fertilizer prices and add to the financial burden on the farmers”. Ghulam Ahmad , APFDA chairman said on Tuesday in his talk with NEWSMAN.
APFDA chief said the proposed increase in turnover tax on fertilizer sales will add another Rs 20 to Rs 40 in cost of per fertilizer bag and leave the farming community in serious trouble. He further argued that the farming community is already facing hard times due to rising cost and low return on their produce and any new tax on fertilizers will simply make Pakistan’s agriculture sector redundant.
The government has suggested increase in turnover tax by 100 % on sales of fertilizers in the coming budget. The fertilizer dealers pay 0.25 % turnover tax on sale of fertilizers. Now this tax is being increased to 0.50 % through Financial Bill 2026-27.
Pakistan’s agriculture sector is in trouble due to lack of interest of the current government and resultantly output of this sector has suffer massively in the last couple of years. Pakistan’s major crops like cotton and wheat have lost their production levels, putting Pakistan’s reliance on imports to meet the local demands. Although multiple factors have contributed to damage Pakistan’s agriculture in the recent years, but the growing input costs like fertilizers and seeds have simply added to the pace of damage to the farming sector.. Sharp decline in offtake of fertilizers in 2025 and first quarter of 2026 indicates negative effect of the rising cost of the fertilizers on Pakistan’s agricultural production.
A vast majority of small farmers is not making judicious use of the fertilizers due to their high cost and its damaging per acre yield in Pakistan. India’s per acre yield of major crops is 40 percent more than Pakistan and its major reason is prudent use of fertilizers by Indian farers. Pakistani farmers are demanding of the government to give them incentives like cheap agri inputs and concessional electricity for better agricultural productivity, but their demands are going unheard. Interestingly, the government proposed reduction in taxes for multiple sectors like real estate and exports in the budget 2026-27 , but it simply ignored the agriculture sector which provides on farm jobs to millions and meets growing food demand of 250 million people of Pakistan.
APFDA is fighting the case of the farming community for long. It always cautions the government of negative impact of rising cost of the fertilizers and proposes to the decision-makers workable suggestions to have win-win situation for the government and the farming community of Pakistan.
Ghulam Ahmad wonders why the government was going to upload new taxes rather than incentive the agriculture sector in the next budget. He said “ Instead giving incentives to the agriculture sector, in particular, to the fertilizer dealers, the government is going to increase turnover tax on the sale of fertilizers”. He warned that any government action of increasing taxes on the fertilizer dealers will bring negative result for agri sector and hence for Pakistan.
