The government has announced a major tariff reform plan aimed at cutting import duties and boosting economic activity.
Under the new five-year National Tariff Policy 2025-30, customs and regulatory duties will be gradually reduced to promote competition, lower import costs, and provide equal opportunities for local and international markets.
Government is planning to reduce the average tariff rate from 20.19 percent to 9.70 percent.
The move could result in a revenue loss of Rs143 billion; however, parliamentary circles say the reforms will increase market competition and reduce import costs.
According to officials, the proposal aims to limit customs duty to a maximum of 15 percent within five years. The plan also includes gradually reducing additional customs duty from 6 percent to zero, while the maximum regulatory duty rate will be capped at 20 percent and phased out over time.
The Ministry of Commerce said the target is to bring the average import duty rate down to 16.56 percent over five years.
The Engineering Development Board has also recommended applying the same tariff structure to locally manufactured and imported vehicles.
