ISLAMABAD – Pakistan is losing Rs400 billion every year due to the illegal cigarette trade, warned Fair Trade in Tobacco (FTT) Chairman Ameen Virk during a seminar in Islamabad. He described the issue as a “structural crisis”, not just minor tax leakage, and urged the Federal Board of Revenue (FBR) to maintain pressure on violators through sustained action and long-term enforcement reforms.
Virk said that while recent raids and seizures by FBR, Customs Intelligence, and Inland Revenue were encouraging, they must not remain isolated events. He emphasized that illegal cigarette manufacturers are operating openly, selling products without health warnings, at illegal prices, and without using the government’s Track and Trace System, which is designed to prevent tax evasion.
He pointed out that legal tobacco companies contribute over Rs300 billion in taxes, yet more than 40 unregistered companies are distributing illegal brands across the country. These brands are widely advertised, sold in bulk, and often avoid all forms of regulatory compliance. “This is money that could fund hospitals, schools, and infrastructure,” Virk stated, urging policymakers to act before the damage worsens.
Virk highlighted that the illegal tobacco trade reflects a wider trend seen in sectors like petroleum and real estate, where tax evasion and weak enforcement cost the nation heavily. He stressed that this is not only a fiscal threat but also an attack on Pakistan’s regulatory credibility. “Even recovering half of these losses could help reduce the country’s fiscal deficit,” he added.
In closing, the FTT chief called for political will, policy consistency, and better resourcing of enforcement bodies. He said FBR needs stronger legal powers, ongoing raids, and high-level backing to effectively crack down on tax evasion in the tobacco sector. “We stand by the government,” he said, “but we expect firm, visible, and sustained results.”