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Smuggling of Illicit cigarettes: Pakistan may lose Rs 100b in five years

Smuggling of Illicit cigarettes: Pakistan may lose Rs 100b in five years

LAHORE: Pakistan is expected to lose Rs. 100 billion in the next five years due to the extensive smuggling of banned cigarettes despite the fact that FBR has been stressing the need to curb the smuggled cigarettes’ trade especially the pine brand.

During the last five years, Pakistan has lost Rs. 80 billion due to illicit trade of cigarettes, Euromonitor International, a global research agency, reported.

The agency said the penalties for the sale of smuggled cigarettes included confiscation of such cigarettes, fine up to Rs. 50,000, recovery equal to 500% of unpaid taxes and the imprisonment up to five years.

However up till now the markets are flooded with smuggled cigarettes’ brands, especially in the absence of enforcement.

Under the laws, the mandatory pictorial and textual health warning in Urdu and English as well as printing of underage sale warning and retail price on each pack is mandatory for cigarettes packs to be sold in Pakistan.

Smuggled cigarettes, however, do not comply with any of these mandatory requirements. In addition to that due to non-payment of duties and taxes, the national exchequer suffers huge losses.

Understanding the severity of the issue, Federal Board of Revenue has come down hard on the illicit cigarettes’ traders and the Interior Minister has also directed action against this menace.

A strict action has been ordered against smuggled cigarettes including the Korean brand pine, which are being sold in the domestic market in open violation of applicable laws.

According to official sources, in order to control the sale of smuggled cigarettes across the province, the Interior Minister Punjab has written a letter to Inspector General of Police Punjab, in this regard.

The letter also makes note of the advertisements issued by Federal Board of Revenue (FBR) recently in this regard, warning the retailers and wholesalers against sale of smuggled pine cigarettes, while calling for relevant action by field formations of police force.