LCCI Terms Reduction In Sindh Infrastructure Cess Positive For Exporters, Importers

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By Commerce Reporter

LAHORE — The Lahore Chamber of Commerce and Industry has welcomed the decision of the Government of Sindh to reduce the Sindh Infrastructure Development Cess (SIDC) from 1.85% to around 0.80–0.85%, terming it a positive development for the business community that would facilitate trade and industrial operations.

LCCI President Faheem Ur Rehman Saigol, Senior Vice President Tanveer Ahmed Sheikh and Vice President Khurram Lodhi said that the decision to reduce SIDC is a step in the right direction and aligns with the longstanding demand of the Lahore Chamber for rationalization and eventual abolition of the cess.

They said that the reduction will lower the cost of importing raw materials, machinery and intermediate goods, particularly for export-oriented industries that rely heavily on imports for value addition. By easing input costs, it will provide some relief to manufacturers and exporters who are already operating under tight margins due to high energy and financing costs.

They added that the reduction would help improve price competitiveness of Pakistani products in both domestic and international markets by reducing transactional costs associated with imports. Importers would benefit through lower upfront costs and improved liquidity, while exporters would gain from reduced production expenses, enabling them to compete more effectively in regional and global markets.

The LCCI office-bearers further noted that another important benefit of the reduction would be the likely decrease in long-standing litigation between businesses and the Sindh authorities over SIDC. The cess had been a major source of legal disputes and compliance uncertainty, increasing administrative costs for both the government and industry. A lower rate may encourage greater compliance, reduce legal friction and create a more predictable business environment.

However, they emphasized that although the cess has not been fully abolished as consistently advocated by LCCI, the reduction will still provide partial relief to the business community. They reiterated that the complete abolition of SIDC remains essential to significantly reduce the cost of doing business, facilitate smoother trade operations and improve Pakistan’s export competitiveness.

They urged the relevant authorities to consider eliminating the cess altogether in order to enhance investor confidence, ensure ease of doing business and support sustainable export-led economic growth.