ISLAMABAD: A survey has found that a staggering 81.01 per cent of cigarette brands available at retail outlets in the country do not carry tax stamps, indicating widespread evasion of excise duty.
Only 12.03 per cent of the products were found to be tax-stamped, while 6.96 per cent appeared in both taxed and untaxed forms, pointing to a parallel distribution network operating alongside compliant cigarette brands.
The survey titled “The Unchecked Rise of Illicit Cigarettes in Pakistan”, conducted by Stop Illegal Trade (SIT) -- a forum for the prevention of illicit trade in the country -- has highlighted an alarming level of non-compliance with tax and tobacco control regulations across retail markets in the country. The findings point to a thriving black market and underscore the urgent need for stronger enforcement to curb illicit trade.
The survey also found that nearly 47 per cent of cigarette brands failed to display mandatory health warnings on their packaging, in direct violation of national tobacco control laws. With only 53.16 per cent of brands complying, the widespread presence of unregulated cigarette brands continues to challenge enforcement mechanisms.
Equally alarming is the frequent sale of cigarettes below the government-mandated minimum retail price of Rs162.25 per packet. The availability of these under-priced products not only undermines legal businesses but also fuels consumption, particularly among price-sensitive consumers.
Commenting on the findings, the spokesperson for SIT said: “The survey exposes the extent of tax evasion and regulatory weaknesses that are allowing illicit cigarettes to thrive. “These practices not only deprive the government of critical revenue but also endanger public health by increasing access to illegal and non-compliant products.”
The spokesperson urged policymakers and enforcement agencies to prioritise retail-level inspections, enforce compliance with existing laws, and crack down on the distribution of illicit cigarette brands, adding: “Without immediate intervention, Pakistan risks further revenue losses and serious setbacks in its public health goals”.
It is pertinent to mention that the illicit cigarette trade currently accounts for over half of Pakistan’s total market and causes an annual revenue loss of over Rs415 billion to the national exchequer.
