Sharing the latest trends in the market, Pakistan Tobacco Company (PTC) informed that the sale of illegal (smuggled, tax evasion, and counterfeit) cigarettes has increased to around 60 percent in South Punjab, resulting in a loss of billions of rupees to the exchequer.
Addressing the media in Multan, Trade Development Analyst Mohsin Ali mentioned that South Punjab was the most affected by tax evasion and bootleg brands being sold openly in retail outlets. After the gradual increase in excise taxes, consumers moved to cheaper, tax-evading, and contraband cigarettes that are illegal. Ironically, these brands of cigarettes are openly sold in the market because enforcement has not been able to create the required level of deterrence.
Media personnel conducted a market visit to various areas in Multan to get an insight into the growing trend of illegal cigarettes and how the laws are being openly flouted. It is important to note that the government of Pakistan has set the minimum price of a pack of cigarettes at PKR 127.44, which is not enforced in letter and spirit. Most cigarette brands are sold at prices ranging from Rs.80 to Rs.130. It was also observed that most of the cigarettes sold were without Track and Trace Stamps. There were also contraband cigarettes of various brands that were sold without graphic health warnings. Manufacturers of illegal cigarettes openly flout rules and regulations, including through free cigarette packs and reward programs.
To stop this growing trend of illegal cigarettes, the government needs to alert its law enforcement agencies (LEAs) to this organized crime network and take strict action against the sales and distribution network of the tax-evading cigarette industry.
