KARACHI: The provincial cabinet of Sindh, Pakistan’s southern province, approved the Agricultural Income Tax Bill 2025 on Monday, introducing new taxes on farm earnings. The move has caused concerns that it could lead to higher prices for essential food items such as wheat, rice, and vegetables.
Chief Minister Sindh Murad Ali Shah in a post on X said that the provincial cabinet has approved the Agriculture Income Tax law and the digitalisation of cabinet proceedings. “However, some cabinet members expressed reservations, warning that the agri tax could drive up vegetable and grain prices,” he said.
The Sindh Agricultural Income Tax Bill 2025 will take effect in January 2025. 20 per cent tax would be levied on small companies, while 28 per cent on big ones, 24News TV channel reported.
https://twitter.com/SindhCMHouse/status/1886287237920293340
The new legislation introduces additional taxes on farmers’ income, raising concerns that the prices of essential commodities such as wheat, vegetables, and rice may see further hikes, adding to the financial challenges faced by farmers in the province. The chief minister has said that the bill would not apply to the livestock sector.
If the agricultural income would be between Rs150 million and Rs200 million, one per cent tax would be levied; two per cent tax if the income is between Rs200 million and Rs250 million; three per cent tax if the income was between Rs250 million and Rs300 million; four per cent tax if the income was between Rs300 million and Rs350 million; six per cent tax if the income was between Rs350 million and Rs400 million; eight per cent tax if the income was between Rs400 million and Rs500 million and 10 per cent tax if the income exceeded Rs500 million, sources elaborated.
Although the provincial cabinet admitted that new taxes would increase the prices of vegetables, rice and wheat, however, the cabinet members approved citing national interest.
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Chief Minister Syed Murad Ali Shah informed the cabinet that funds from the NFC Award’s divisional pool were allocated to provinces based on their respective shares. Punjab received 51.74 percent, Sindh 24.55 percent, Khyber Pakhtunkhwa (KP) 14.62 percent, and Balochistan 9.09 percent.
He noted that Sindh received Rs498.067 billion in 2022 and Rs3002.43 billion over the past three financial years (2021-22, 2022-23, and 2023-24). However, the province faced a shortfall of Rs77.16 billion from its entitled share.
Expressing concern over excessive spending on file maintenance, the cabinet approved the development of a digital application to streamline and digitize its meeting minutes.
