Budget 2026-27: Sales Tax on stationery may increase from 10% to 18%

ISLAMABAD: Stationery items are likely to become more expensive from July 1, 2026, as the federal government is considering increasing the sales tax on stationery products from 10% to 18% under the upcoming Finance Bill 2026-27.

According to sources, the proposal is being reviewed as part of the government’s efforts to broaden the tax base. The move follows a reported demand by the International Monetary Fund (IMF) to withdraw the existing concessionary sales tax rate on stationery items.

If approved, the higher tax rate will apply to a wide range of educational and office supplies, including notebooks, registers, pens, pencils, and other stationery products, resulting in higher prices for consumers.

The revised tax rate is expected to come into effect from July 1, 2026.

Meanwhile, the federal government is set to present the FY2026-27 budget on June 10. The National Assembly’s budget session will begin at 5:00 pm, with Finance Minister Senator Muhammad Aurangzeb scheduled to present the budget proposals.

The budget was originally planned for June 5 but was later rescheduled.

Separately, the government has decided to provide significant tariff relief to the pharmaceutical, logistics, and construction sectors under the National Tariff Policy (NTP) 2025-30 to promote investment, trade, and industrial growth.

Prime Minister Shehbaz Sharif has directed relevant authorities to ensure the effective implementation of the tariff policy and modernize tariff-related institutions to improve the business environment.

Officials said duties on reefer containers and semi-trailers would be abolished to support the logistics sector and enhance supply chain efficiency. Customs duties on specialized vehicles and machinery will also be reduced to encourage growth in the construction sector.

In addition, customs duties on key pharmaceutical raw materials, particularly those used in the production of cancer medicines, will be eliminated to support local manufacturing and improve access to essential medicines.

Major tariff relief announced for pharmaceutical, logistics and construction sectors