Illicit cigarette sector costs Rs70b to national exchequer annually

Islamabad : To raise awareness against corporate tax evasion especially the damages done by tax evasion of illicit cigarette sector, a unique walk was organised by Behter Pakistan Hum Qadam campaign, on Sunday.

A large number of people including celebrities, politicians, social workers, and students participated in the walk. The campaign theme song Hum Qadam by Fakhir Mehmood and Nadeem Jafri gave more energy to the participants especially when both singer and musician joined the walk to highlight the cause.

“The song will be formally launched after two days with the video made out of the images from today’s walk,” said Fakhir while talking to ‘The News’. He said that he had joined the walk to support the cause as he believes that strict tax collection would lead to a strong economy. He encouraged everyone to join the campaign in order to play their part in highlighting such an important aspect of the economy.

Nadeem Jafri said that tax collected from such sources could be utilized in the education sector and provision of other basic services. He urged the government to take strict measures against all those involved in tax evasion. “It is the public money and must be used for the benefit of the general public,” he said.

As part of the walk, seven gates were installed from China Chowk to D Chowk symbolizing Rs10 billion to Rs70 billion tax evasion by illicit cigarette sector every year. The participants received a sticker after crossing every gate starting from Rs10 billion and were presented with the certificates when they crossed the Rs70 billion gate acknowledging their effort to raise awareness against the illegal practice that is damaging the economy.

The walk was also joined by Senator Faisal Javed and philanthropist and Chairman Pakistan Red Crescent Society Ibrar ul Haq as Cause Champion.

Talking to ‘The News’, Ibrar ul Haq said that he had joined the campaign as he believes that it is very important to work around the issue of tax evasion for the economic prosperity of the country. He said that government shall take bold steps to collect tax from corporate sectors that are involved in illicit practices with regard to paying taxes.

Speaking on the occasion, Senator Faisal Javed said that the tax money collected from such sectors shall be used in improving basic infrastructure and social services.

MNA Wajeeha Akram said that the corporate sectors involved in illicit tax evasion are running a parallel economy and giving the national exchequer a loss of Rs310 billion. “Only cigarette sector contributes Rs70 billion in that loss. The whole nation shall get this awareness and become part of this effort to bring all such sectors under tax cover,” she said.

Farah Hashmi, media focal person of the campaign, shared that illicit cigarette trade is more than 40 per cent of the total cigarette market and locally manufactured illicit cigarettes evade duties and taxes. She said that 200 illicit cigarette brands are selling a pack of cigarette for Rs15 to Rs40 despite the mandated minimum price per pack for Rs62.76 an inclusive minimum tax of Rs42.12. The minimum tax and minimum price law violations are not only compromising fiscal objectives of the government but also going against our national health agenda.