No tax stamps on 81.01pc of cigarette brands available at retail outlets, says a survey

ISLAMABAD: A newly released survey has revealed that a staggering 81.01 percent of cigarette brands available at retail outlets do not carry tax stamps, indicating widespread evasion of excise duties. Only 12.03 percent of the products were found to be tax-stamped, while 6.96 percent 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), an advisory forum for 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 percent of cigarette brands failed to display mandatory health warnings on their packaging, in direct violation of national tobacco control laws. With only 53.16 percent 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. 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,” he said.

He urged policymakers and enforcement agencies to prioritize retail-level inspections, enforce compliance with existing laws, and crack down on the distribution of illicit cigarette brands. “Without immediate intervention, Pakistan risks further revenue losses and serious setbacks in its public health goals,” he added.

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.

Copyright Business Recorder, 2025