FBR Demands Post-Dated Cheques From Juice Industry in Exchange for Tax Cut in FY26 Budget

The Federal Board of Revenue (FBR) will only reduce the federal excise duty (FED) on packaged juices from 20 to 15 percent in the 2025–26 budget if the industry submits post-dated cheques covering the tax to be collected in the next fiscal year. The FBR chairman on Thursday proposed that the industry submit post-dated cheques to support its claim that lower tax rates would boost volumes and ultimately increase revenue. The industry expressed concern over the practicality of providing cheques for sales that have not yet occurred. The FBR maintained that any tax relief must be offset by a mechanism to secure revenue. The Fruit Juice Council argued that the imposition of 20 percent FED, along with 18 percent GST since the 2023–24 budget, has led to a 45 percent decline in industry sales. The downturn has halted new investment, reduced production capacity utilization, and caused fruit procurement volumes to drop below 2017 levels. Mango purchases, for instance, fell to 20,233 tons last year compared to 31,000 tons in 2017–18. With consumers now paying up to 42 percent in taxes on juice products, many have turned to unsafe options from the undocumented sector which accounts for more than 25 percent of the market. The Council emphasized the potential of the formal packaged juice industry to expand exports and reiterated its request for a reduction in the FED to 15 percent.