Sale of smuggled cigarette a big challenge for govt

RECORDER REPORT

ISLAMABAD: The ongoing sale of a smuggled brand of cigarette is a big challenge for the Directorate General of Intelligence and Investigation Inland Revenue (IR) Federal Board of Revenue (FBR) to check its movement during the national drive against non-duty paid or smuggled cigarettes/ tobacco.

Industry sources told Business Recorder here on Tuesday that the Directorate General of Intelligence IR has started conducting raids on the stockists and wholesalers of non-duty paid or smuggled cigarettes on March 1, 2012. In this regard, the agency would conduct raids on stockists and wholesalers of non-duty paid or smuggled cigarettes/ tobacco in Khyber Pakhtunkhwa (KPK). The DG Intelligence IR has established a dedicated unit in the KPK for launching the drive from Peshawar along with other areas of the province.

The agency should also check selling of smuggled Pine cigarettes being sold without payment of excise duty and violation of Pictorial Health Warning Laws. Shops in different cities are selling smuggled cigarettes, which is a blatant violation of Pakistani laws. The Directorate General of Intelligence IR should give top priority to stop the selling of the said brand of smuggled cigarette during recent drive in KPK. The agency has also intercepted vehicles carrying non-duty paid smuggled cigarettes/tobacco and movement of such smuggled cigarettes should also be checked in particularly KPK, industry experts suggested.

Parliament enacted numerous laws for reducing smoking, which included the Pictorial Health Warning under the Printing of Warning Ordinance 1979.

However, the blatant and unrelenting sale of smuggled cigarette packs without the Pictorial Health Warning not only depicts the weakness of the government but also undermines the government's health agenda.

Industry experts have disclosed that since the introduction of the Pictorial Health Warning in September 2010, the sales of the smuggled brand has increased.

According to sources, the said brand of smuggled cigarette is being smuggled from Torkham and Chamman. The unhindered smuggling and the subsequent sale of the smuggled cigarettes is a clear indicator of the non- serious attitude of the concerned officials and the overall appalling state of affairs. As per rough estimates, the smuggling of Pine alone causes an annual loss of over Rs 1 billion to the national exchequer, while the overall loss caused by smuggled cigarettes is over Rs 1.65 billion.

The sale of smuggled cigarettes in the markets is a clear violation of a number of anti-smuggling and pictorial health warning laws, but due to poor enforcement such illicit cigarettes continue to be readily available and within easy access, sources opined.

It is worth mentioning that in the first phase of crackdown, the directorate of intelligence IR has launched the drive in KPK, the major producer of tobacco. The intelligence agency would conduct raids on the premises of illegal warehouses of tobacco/cigarettes and sellers of smuggled cigarettes. The raids on the units engaged in evasion of duties and taxes would give a clear and loud message to the cigarette industry to comply with the law and stop selling of smuggled cigarettes.

These raids on illegal warehouses would effectively check the supply line of non-duty paid cigarettes to the market. Later, the drive would be replicated in the remaining parts of the country as well.