Khyber Pakhtunkhwa Mulls Steep Tax Hike

Pakistan’s Khyber Pakhtunkhwa government is mulling an increase in the local tobacco tax (cess) by 400 percent, reports Pakistan Today. The increase is expected to generate revenue of more than PKR2 billion ($7.2 million) annually.

A meeting between Muzammil Aslam, advisor to the chief minister of finance; Aqibullah Khan, provincial minister for irrigation; Akmal Khatak, director general of excise; and a representative delegation of tobacco growers approved a proposal to increase the tobacco development cess by PKR50 per kilogram for Viginia tobacco, PKR30 per kilogram for white leaf rustica tobacco and PKR20 per kilogram for niswar tobacco.

The tobacco development cess is not equal to the actual price of tobacco, the meeting was informed. Various proposals are under consideration to increase the cess. An action plan for exports is being prepared to increase income from tobacco exports, according to Aslam.

The provincial government currently earns PKR500 million annually from tobacco taxes.