Cigarette makers support FED

KARACHI: Cigarettes manufacturers on Tuesday supported the Federal Board of Revenue (FBR) for levying advance federal excise duty through Finance Bill 2019/20 saying that it would help in the documentation of the economy and discourage smuggling.

Philip Morris (Pakistan) Limited Director Affairs Khurram Mohammad Qamar said, “This levy is not on farmers, but on tobacco manufacturers and is an advance excise duty which is adjustable against the total liability of the cigarette manufacturers while the exporters are fully exempt.”

He said the farmers were already protected under the Pakistan Tobacco Board Ordinance 1968 and would not be impacted by this levy. The finance bill proposed to insert an explanation that the duty on un-manufactured tobacco should be borne by the manufacturer and not be passed on to the tobacco grower.

The tobacco industry in Pakistan was plagued with illicit trade, causing a loss of over Rs44 billion each year. In September 2018, the PTI government introduced an advanced excise duty on processed leaf to document the supply chain of tobacco and curtail illicit trade.