The Pakistan Steel Melters Association (PSMA) has submitted its proposals for the Federal Budget 2025-26, aiming to revitalize the domestic steel industry and promote economic growth.
The proposals focus on key challenges such as sales tax evasion, high electricity costs, and smuggling. PSMA recommends reinstating the ‘Special Procedure’ that links sales tax liability to electricity consumption, a move expected to significantly enhance revenue collection. To further address tax evasion, the association suggests registering scrap dealers and collectors with tax authorities, exempting local scrap from withholding tax for steel melters, and tightening oversight of small furnaces and rolling mills.
The association also advocates for a substantial increase in regulatory duty on steel billet imports and a reduction in electricity tariffs to support efficient, high-quality steel production. It calls for stricter regulation of steel imports through seaports to curb smuggling and under-invoicing.
Additionally, PSMA recommends a phased reduction in tax exemptions for businesses in FATA and PATA to ensure fair competition across all regions. PSMA believes that implementing these measures will strengthen the industry’s contribution to the national economy and urges the government to incorporate them into the upcoming budget.