Pakistan’s Steel Melters Association (PSMA) has called on the government to abolish withholding tax on local scrap purchases and rationalize electricity tariffs in the federal budget for FY2026/27 to support the domestic steel industry.
Speaking at a press conference, PSMA Chairman Mian Ahmad Hassan said the industry had submitted a series of proposals aimed at improving competitiveness, reducing tax evasion, and encouraging local steel production.
Among the key recommendations, the association proposed the removal of withholding tax on locally sourced scrap, arguing that the measure would support domestic recyclers and reduce reliance on imported raw materials. It also called for higher regulatory duties on imported billets to offset high local energy costs and protect domestic producers. PSMA further urged the government to reduce electricity tariffs for steel melters.
Other proposals included taxing small furnaces based on transformer and panel capacity, reducing customs duties on high-quality industrial scrap, routing all steel imports through seaports to curb smuggling and under-invoicing, and phasing out tax exemptions in FATA/PATA and Gilgit-Baltistan to create a level playing field for the industry.
According to the association, the proposed measures would help strengthen Pakistan’s steel sector while supporting domestic manufacturing and investment.