The government, in its Federal Budget 2026-27 announcement on Friday, has abolished the 0.25 percent Export Development Surcharge previously imposed on export income, marking a policy shift aimed at easing pressure on the country’s exporting sector.
Presenting the budget in the National Assembly, Finance Minister Muhammad Aurangzeb said the decision forms part of a broader strategy to strengthen exporters, improve liquidity, and encourage export-led economic growth.
He stated that the surcharge on export income had been “completely abolished,” with the objective of reducing financial constraints on exporting businesses and enhancing Pakistan’s competitiveness in global markets.
Officials said the move is intended to support sustained export momentum while contributing to broader macroeconomic stability through structural reforms and improved external sector performance.
In a parallel measure, the government has also extended the financing period under the Export Finance Scheme from nine months to eighteen months. According to officials, this adjustment is designed to ease working capital pressures and provide exporters with greater flexibility in managing operational cash flows.
The extension is expected to benefit businesses that rely on longer production cycles and international payment timelines, particularly in sectors exposed to fluctuating global demand.
The government has identified export expansion as a central pillar of its economic strategy for the coming fiscal year, projecting improved performance driven by policy support measures and efforts to enhance trade competitiveness.
Together, the removal of the Export Development Surcharge and the extension of export financing facilities reflect a broader policy direction focused on strengthening external sector resilience and supporting export-oriented industries.
