FTT Praises Government To Recognize Billions Of Tax Due To Illicit Cigarette Tarde

Chairman of the Fair Trade in Tobacco (FTT), Ameen Virk, has appreciated the government of Pakistan and the Federal Board of Revenue (FBR) for what he termed a “positive realization and acknowledgment” of the scale of tax losses caused by the illegal cigarette industry

ISLAMABAD, (UrduPoint / Pakistan Point News - 12th May, 2025) Chairman of the Fair Trade in Tobacco (FTT), Ameen Virk, has appreciated the government of Pakistan and the Federal board of Revenue (FBR) for what he termed a “positive realization and acknowledgment” of the scale of tax losses caused by the illegal cigarette industry.

Speaking at a roundtable discussion with senior journalists in Islamabad, Virk welcomed the federal authorities’ admission that the country loses more than Rs 300 billion annually due to tax evasion and illicit tobacco trade, said a press release.

“We are encouraged to see that the FBR leadership, particularly Chairman Rashid Mahmood Langrial, has openly stated before the National Assembly’s Standing Committee on Finance that the annual loss in the tobacco sector alone is in the range of Rs 300 billion,” Virk said.

“For far too long, this issue was either underestimated or overshadowed. But the clarity with which the government is now addressing it is commendable.”

Virk also acknowledged the efforts of Finance Minister Muhammad Aurangzeb, who recently met with representatives of the legal tobacco industry during his official visit to London. During the meeting, concerns regarding smuggling, counterfeit products, and the implications of the current excise duty regime were raised.

“The meeting between the Finance Minister and senior industry representatives sends a strong signal that the government is ready to listen and respond to the realities on the ground,” Virk stated. “We sincerely hope that the gravity of the situation will be reflected in upcoming budgetary and enforcement decisions. Since 2023, the legal cigarette industry has lost over 21% of its market share to illegal operators, who now occupy 56% of the total market.

This is not sustainablefor the industry or the country’s fiscal health.”

The FTT chairman also praised the role of the National Assembly’s Standing Committee on Finance, particularly for reaffirming the FBR’s estimates of annual revenue losses and for questioning the loopholes in enforcement mechanisms. “We are grateful to the committee members who treated this issue with the seriousness it deserves,” he noted. “Only through parliamentary support can a cohesive national strategy be implemented to address this long-standing crisis.”

Calling on the government to expand and intensify its enforcement actions, Virk emphasized that the potential revenue from the cigarette sector could exceed Rs 600 billion annuallyif illegal trade is decisively dismantled and all players are brought within the tax net.

“Let me be clear: the illegal cigarette trade affects every province and district and undermines economic and regulatory frameworks,” Virk asserted. “We urge the government to continue its enforcement operations without compromise and to take coordinated action against tax evasion across the tobacco value chain. The benefits to national revenue, public health regulation, and formal economic activity would be immediate and substantial.”

In closing, Ameen Virk reiterated the commitment of Fair Trade in Tobacco to support the government and the FBR in achieving greater transparency and accountability in the tobacco sector. “We stand ready to assist in any effort prioritizing enforcement, equity, and economic reform.”