ISLAMABAD – In a sweeping overhaul of the import duty regime, the government has revised Customs laws through amended Finance Bill, 2025 to implement a revised structure of tariff slabs, effective from July 1, 2025. The move is part of a broader tariff rationalization plan aimed at streamlining import costs, encouraging trade, and aligning with global best practices.
Under the new structure, three revised tariff slabs of 5%, 10%, and 15% will replace the earlier slabs of 3%, 11%, and 16%. These adjusted rates are designed to simplify the tax system and provide a more predictable cost structure for importers.
One of the most significant changes includes the expansion of the zero per cent tariff slab to cover an additional 916 Pakistan Customs Tariff (PCT) codes, in addition to the existing 2,201. This expansion aims to encourage the import of essential commodities, reduce inflationary pressure, and enhance the availability of key inputs for local industries.
The Customs duty has also been reduced on 2,624 PCT codes, signaling a shift toward a more business-friendly import policy. Additionally, major revisions have been made to the Additional Customs Duty (ACD) regime. For items falling under the zero per cent, 5%, and 10% tariff slabs, the ACD has been reduced from 2% to zero—benefiting 4,383 tariff lines, except for 95 sensitive items that will continue to attract ACD.
Meanwhile, the ACD has been cut from 4% to 2% for goods under the 15% slab, and from 6% to 4% for items under the 20% tariff slab. Products with tariffs exceeding 20% will see a marginal ACD drop from 7% to 6%.
Reforms have also been introduced in the regulatory duty (RD) regime. RD has been completely removed on 554 PCT codes and reduced on another 595, with the maximum RD rate now capped at 50%, down from 90%.
Further, the amended Finance Bill 2025 introduces two new sections to the Customs Act. Section 225 establishes a Customs Command Fund sourced from auctions of smuggled goods, which will finance anti-smuggling operations. Section 226 empowers the board to declare Customs check posts as Digital Enforcement Stations to enhance monitoring through advanced technology.