ISLAMABAD: ACT Alliance Pakistan has welcomed recent enforcement measures by the Federal Board of Revenue (FBR) against illegal cigarette manufacturing, smuggling and violations of the Track and Trace System (TTS), saying the crackdown could help improve tax collection in Pakistan’s tobacco sector.
The organisation said stronger enforcement against the illegal tobacco trade was necessary to address revenue losses linked to undocumented cigarette production and non-duty-paid products. According to ACT Alliance Pakistan, recent FBR actions could contribute around Rs50 billion in additional tax revenue during the current fiscal year.
In a statement, ACT Alliance Pakistan Country Director Mubashir Akram criticised what he described as an overemphasis by some NGOs on increasing taxes on the legal tobacco industry while paying limited attention to illicit cigarette sales and tax evasion.
He said the illegal cigarette market had expanded significantly in recent years, arguing that the decline in documented cigarette sales reflected a shift toward untaxed and unregulated products rather than a major reduction in overall consumption.
Akram also questioned estimates regarding the size of the illicit cigarette market in Pakistan, saying different assessments presented varying figures for illegal trade and related revenue losses. He said enforcement efforts should focus on illegal manufacturing units, smuggling networks and retail-level violations.
The statement further raised concerns about compliance with the Track and Trace System, claiming that several cigarette brands in the retail market were either non-compliant or being sold below the minimum legal price. ACT Alliance Pakistan said effective implementation of the system required broader enforcement across the supply chain.
The organisation called on federal and provincial authorities to continue action against illicit cigarette manufacturing, counterfeiting and undocumented distribution channels. It also urged policymakers to prioritise market documentation and enforcement measures alongside future tobacco tax reforms.
