VAT Registration Threshold: Reduced from Rs 6 Million to Rs 3 Million - Everyday Products May Become More Expensive

The 2025-2026 Budget has lowered the VAT registration threshold from Rs 6 million to Rs 3 million in annual turnover. This measure took effect on October 1, 2025, affecting approximately 7,000 small and medium enterprises (SMEs), including food vendors at market stalls, such as dhollpuri sellers, food and non-food retailers, restaurants, fast-food outlets, cafes, and caterers, as well as others.