Finance

Fertilizer sector’s earnings to decline by 17% in 2022

Karachi, June 28, 2022: The imposition of Super Tax would cause earnings of the fertilizer sector to decline by 17% on average for Calendar Year 2022.

Though the Federal Budget FY23 was almost silent on the fertilizer sector, a 10% tax has been announced recently which would be charged on CY21 profits.

The government has announced another round of taxes with an estimated incremental tax collection of Rs 235 billion to cater to IMF’s revised revenue target.

Outlook

Even with the additional one-time tax charge, the incumbent government’s increased focus on improving agriculture yields and farmers’ income will help the sector stay in the limelight.

In the event of any gas price increment, the key factor will be the manufacturers’ ability to pass on cost pressures, given government’s recent pushback on urea prices.

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