LCCI Seeks Level Playing Field on Tax-Free Imports via Sost Border

By Dr. Ansab Ali
Lahore, Pakistan
LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) has called for a comprehensive, consultative and nationally harmonised approach to import tax exemptions, following the Federal Board of Revenue’s (FBR) decision to allow the tax-free import of more than 2,400 Chinese goods through the Customs Dry Port Sost for exclusive consumption in Gilgit-Baltistan.
Commenting on the notification issued under S.R.O. 2488 (I)/2025, LCCI President Faheem ur Rehman Saigol acknowledged the government’s objective of facilitating economic activity and ensuring the uninterrupted supply of essential goods to Gilgit-Baltistan. He said the LCCI fully supports initiatives aimed at regional development, economic inclusion and improved livelihoods in underdeveloped areas. However, he stressed that such fiscal measures must be carefully designed to ensure a level playing field for businesses across Pakistan.
Saigol noted that Pakistan’s industrial and commercial sectors are already operating under severe pressure due to high energy costs, expensive financing, elevated taxation and shrinking profit margins. In this environment, selective tax exemptions—particularly on a large number of tariff lines—could have spillover effects on domestic markets if not accompanied by strong safeguards and prior stakeholder consultation.
The LCCI president emphasised that chambers of commerce, which represent the country’s productive sectors, should be taken on board before finalising such policy decisions. “Consultation is not only a democratic requirement but also a practical necessity to ensure that policies achieve their intended objectives without harming domestic industry or distorting competition,” he said.
While acknowledging that the notification includes safeguards such as quota limits, first-come-first-served authorisation, domicile requirements and tracking through the Customs Computerised Clearance System, Saigol cautioned that effective on-ground enforcement remains critical. He warned that any leakage of tax-free goods into markets outside Gilgit-Baltistan could seriously harm local manufacturers and traders who continue to bear the full burden of taxes and duties.
Saigol further stressed that policy consistency and predictability are essential for maintaining business confidence. He urged the government to align future decisions on exemptions or special procedures with a broader national trade, industrial and import management policy. He added that if exemptions are necessary for regional facilitation, parallel support measures must be introduced for domestic manufacturers—particularly small and medium-sized enterprises—to safeguard local production, employment and value addition.
Highlighting the importance of strengthening domestic industry, Saigol said Pakistan’s long-term economic stability depends on reducing the cost of doing business, rationalising taxes and promoting local manufacturing, rather than increasing reliance on imports. He warned that regional development initiatives should not inadvertently weaken the national industrial base.
Reiterating the LCCI’s commitment to constructive engagement, Saigol expressed confidence that structured dialogue and stakeholder participation could help refine policies to balance regional development objectives with national economic interests. He concluded by urging the FBR to institutionalise regular consultations with chambers of commerce before issuing major tax or import-related notifications, calling collaborative policymaking key to sustainable growth, investor confidence and economic resilience.