A significant increase in the prices of various food and beverage items is expected in the upcoming federal budget for the fiscal year 2025–26, as the government looks to boost tax revenue.
Sources suggest that soft drinks, sugary beverages, juices, carbonated soda water, flavoured drinks and non-sugar sweet products may see a price hike.
A proposal is under consideration to raise the duty on these items from the current 20 per cent to 40 per cent.
Items such as carbonated drinks made from juice or pulp, syrups, squashes, and similar products are also included in the list. A 20 per cent tax is also being proposed on industrial products made from milk.
Meat products, including sausages, as well as dried, salted or smoked meat, are also likely to become more expensive.
Bakery and confectionery items such as chewing gum, candies, chocolates, caramels, pastries, biscuits, cornflakes and various types of cereals are expected to see a 50 per cent increase in tax rates. Additionally, there is a proposal to increase tax on ice creams, flavoured or sweetened yoghurt, frozen desserts and all other items made from animal or vegetable fat.
A gradual increase of up to 50 per cent in taxes on these items over the next three years is also being considered.
For the next fiscal year, the defence budget is estimated to rise by Rs159 billion, taking the total allocation to Rs2,281 billion.
According to sources, this represents a 7.49 per cent increase over the current fiscal year’s allocation. In comparison to the previous fiscal year (2023–24), the defence budget for 2024–25 was already increased by 14.16 per cent.
The government had allocated Rs2,122 billion for defence in 2024–25. In the preceding year, 2023–24, defence expenditure stood at Rs1,858.80 billion.
This shows a rise of Rs263.20 billion in the current fiscal year’s defence allocation compared to the previous year.
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