Tobacco: govt decides to revise cess rates

ISLAMABAD: The government has reportedly decided to revise cess rates for tobacco up to 2.67 per cent for the crop 2022-23.

Pakistan Tobacco Board (PTB) has been established under Pakistan Tobacco Board Ordinance 1968 mainly to regulate, control and promote the export of tobacco, tobacco products, undertake research in tobacco and develop new tobacco growing areas.

The Board is a self-sustaining organization meeting its expenses through collection of cess. Tobacco cess is levied by the Federal Government under Section 9 of PTB Ordinance 1968 (l of 1968). Under the law, the cess rates, not exceeding three percent ad valorem, are to be notified by the Federal Government, by notification in the official Gazette.

Seminar for sustainable tobacco control in Pakistan

The current cess rates on all types and varieties of tobacco were notified by the Federal Government on July 14, 2021, which are required to be enhanced in line with the increase in Minimum Indicative Prices (MlP) of all types of tobacco that were notified by the Federal Government on February 10, 2022.

Ministry of National Food Security and Research has proposed minimum indicative price of Flue Cured Virginia (FCV) in plain area of 245 per kg with 2.45 per cent increase in cess to Rs 6 per kg from Rs 5.25 per kg whereas in sub-mountainous areas rates will be 281.13 per kg up by 2.13 per cent to Rs 6 per kg from Rs 5 per kg. The minimum indicative price of dark air-cured tobacco will be 149.09 per kg with increase of 2.41 per cent to Rs 3.60 per kg from Rs 2.9 per kg, white patta Rs 123 per kg up by 2.44 per cent to Rs 3 per kg from existing Rs 2.50 per kg.

Copyright Business Recorder, 2022