ISLAMABAD: In a significant move to boost economic activity in the northern region, the Federal Board of Revenue has issued a new statutory regulatory order granting substantial tax exemptions on a wide range of goods imported through the Sost Dry Port for consumption within Gilgit-Baltistan.
The notification, S.R.O. 01 of 2026 dated January 1, authorizes a special clearance procedure for goods arriving at the Customs Dry Port in Sost. Under the new rules, eligible imports will be exempt from sales tax, income tax, and federal excise duty, provided they meet strict criteria designed to localize the economic benefits.
To qualify for the exemptions, importing firms and companies must be solely owned by individuals holding domicile of Gilgit-Baltistan. Each consignment requires an online authorization issued through the Customs Computerized Clearance system by the Government of Gilgit-Baltistan. Furthermore, the cumulative annual value of these tax exemptions is capped at 4 billion Pakistani rupees, as tracked by the customs system.
The tax relief will be administered by the Collector of Customs on a “first come, first served” basis within the approved annual quota. Any goods imported for consumption in Gilgit-Baltistan beyond this allocated limit will be subject to the standard levy of taxes and duties.
The regulation includes a broad list of over 2,400 specific items eligible for the exemption, classified under Pakistan Customs Tariff codes. The extensive list encompasses essential commodities, including live animals such as bulls, cows, and buffaloes; a vast array of dairy products; fresh, chilled, and preserved vegetables and fruits from tomatoes to mangoes; cereals like wheat, rice, and barley; nuts and spices; basic food preparations like pasta, baked goods, and jams; construction materials like cement and plaster; various plastics and rubber articles; textiles and garments; footwear; machinery and tools; electrical equipment; and even specific vehicle parts and medical instruments.
Stringent safeguards are embedded within the rules to prevent misuse. The Gilgit-Baltistan government is mandated to ensure all goods imported under this notification are used exclusively within its territory. The Chief Collector of Customs (Enforcement) is empowered to take measures to prevent these goods from being taken out of the region.
The Collector of Customs, Gilgit-Baltistan, holds the authority to disallow the tax exemption in cases of mis-declaration serious enough to warrant legal action under the Customs Act, or if goods cleared under the scheme are found outside the region. The Collector can also suspend the non-levy benefits in consultation with the local government if customs operations are disrupted by protests or road blockades.
The FBR stated that all standard provisions of the Imports and Exports (Control) Act, Import Policy Order, and Customs Act remain applicable to all goods imported via the Sost Dry Port, whether destined for Gilgit-Baltistan or the rest of the country. The board also reserved the right to periodically review and adjust the list of eligible item codes and to devise a separate procedure to effectively identify and track goods imported via Sost for other parts of Pakistan.
The rules, which were previously published in draft form in late December 2025, come into force immediately. This policy is seen as a major step towards stimulating local business and ensuring the availability of essential goods in the remote region by reducing the fiscal burden on imports channeled through the strategic Silk Route Dry Port at Sost.