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Tag: Pakistan

  • Pakistani Officials Restrained from Interfering in Tobacco Processing Unit

    Pakistani Officials Restrained from Interfering in Tobacco Processing Unit

    This weekend, Pakistan’s Peshawar High Court (PHC) stopped government officials from interfering in the work of a tobacco processing unit in Mardan, Khyber Pakhtunkhwa Province, following a petition by business owner Mujeebur Rehman.

    Rehman claimed his legally registered unit, which employs hundreds and supplies raw tobacco for cigarette manufacturing, was facing harassment despite tax compliance. His legal team argued that the deployment of Inland Revenue officers and Rangers, as well as the forced installation of surveillance equipment, violated constitutional rights and disrupted business operations during peak tobacco threshing season.

    The PHC asked government respondents, including the Revenue Department and Federal Board of Revenue, to submit their replies while temporarily halting security personnel deployment at the site.

  • Pakistan Empowers Provincial Officials to Seize Illicit Cigarettes

    Pakistan Empowers Provincial Officials to Seize Illicit Cigarettes

    Pakistan’s Federal Board of Revenue (FBR) authorized provincial officials—including deputy commissioners, assistant commissioners, and excise officers—to raid and seize smuggled or tax-evading cigarettes at retail outlets, warehouses, and in transit. Under the order, provincial officers can now target counterfeit or untaxed cigarettes and their transport vehicles. All seized goods will be handed over to the nearest Regional Tax Office for further legal action.

    Seized cigarettes lacking valid tax stamps, or with fake ones, will be confiscated and destroyed, with seizures reported to the FBR within 48 hours using a newly developed application. The move is aimed at curbing illicit cigarette trade and ensuring compliance with excise regulations across Pakistan.

  • Pakistan Sets Prices to Stabilize Tobacco Crop

    Pakistan Sets Prices to Stabilize Tobacco Crop

    Tobacco growers in Pakistan have welcomed the federal government’s decision to set a Minimum Indicative Price (MIP) for various tobacco types, calling it a crucial step for protecting growers’ incomes. The Economic Coordination Committee approved the MIP, making it mandatory for tobacco companies to buy surplus crop at or above the set prices, in line with tobacco marketing law MLO-487.

    Farmers pointed to rising input costs, with tobacco cultivation costing up to Rs1.9 million ($6,650) per hectare, compared to around Rs300,000 ($1,050) for wheat. “If tobacco prices drop, farmers risk losses in the hundreds of thousands,” said former Pakistan Tobacco Board (PTB) director Muhammad Ayaz.

    MIP rates include:

    • Flue-cured Virginia: Rs545/kg ($1.91) (plains), Rs615.9/kg ($2.16) (sub-mountainous areas)
    • White Patta: Rs262.6/kg ($0.92)
    • Barley: Rs316/kg ($1.11)
    • Dark air-cured: Rs388.9/kg ($1.36)
    • Naswar/snuff/hookah: Rs262.6/kg ($0.92)
    • Sun-cured Virginia: Rs350.2/kg ($1.23)
  • Pakistani Vape Vendors Accuse Govt of Harassment as Court Case Proceeds

    Pakistani Vape Vendors Accuse Govt of Harassment as Court Case Proceeds

    On July 3, Pakistan’s Lahore High Court (LHC) disposed of over 100 petitions from vape and e-cigarette vendors across Punjab, barring authorities from taking enforcement action until proper legislation is in place. The petitioners alleged police harassment despite their shops being officially reopened. A government lawyer countered that no formal crackdown was underway and said a draft law to regulate vaping was being prepared, with stakeholder input to be considered.

    The court emphasized that the right to trade is constitutionally protected and questioned the legitimacy of enforcing restrictions without a legal basis. It ruled that no action can be taken against vape businesses until relevant legislation is enacted.

    On June 3, Chief Minister Maryam Nawaz announced a provincial ban on e-cigarettes and ordered vape shops to be sealed. Weeks later, LHC Justice Anwar Hussain said the government failed to justify the crackdown legally and issued a stay order, halting further action until a final decision is made.

  • Pakistan’s Largest Tobacco Growing Region Suffers Huge Storm Damage

    Pakistan’s Largest Tobacco Growing Region Suffers Huge Storm Damage

    Nearly 60% of the Virginia tobacco crop in Pakistan’s Swabi district, Khyber Pakhtunkhwa, has reportedly been badly damaged by a thunderstorm, according to local farmers. The damage occurred at a critical harvesting stage, rendering the affected leaves unsuitable for curing, which has deeply impacted growers’ livelihoods.

    “Once the tobacco plant falls to the ground, its leaves are no longer useful for curing, causing growers huge losses,” said Safdar Khan, a farmer from the Maneri Bala village, adding that the government didn’t come to their aid after being struck by a natural calamity.

    Swabi produces about 53% of KP’s tobacco output, with an estimated 15,500 hectares planted, last year producing about 42 million kg.

    “Due to the damage to our crop, we are stuck in an economic quagmire, and there is no one to help us,” said local grower Baswar Khan.

  • WHO Wants Pakistan to Raise Cigarette Taxes

    WHO Wants Pakistan to Raise Cigarette Taxes

    The World Health Organization (WHO) criticized Pakistan’s Federal Cabinet’s decision to keep its Federal Excise Duty (FED) on cigarettes unchanged in the 2025–26 budget, saying it will likely boost consumption and undermine public health. According to a WHO analysis, FED rates haven’t increased since February 2023, while inflation has surged 26%, resulting in declining real prices and even greater affordability.

    For fiscal year 2024–25, WHO estimated cigarette production in Pakistan reached 37 billion sticks, generating Rs 208 billion ($728 million) in FED revenue. With excise duty unchanged, cigarette output is projected to rise to 38 billion sticks in 2025–26, yielding Rs 217.6 billion ($762 million) in revenue.

    WHO says a Rs 39 ($0.14) per pack FED increase would reduce smoking by 10.7%, lower production to approximately 34 billion sticks, and increase revenues by 20.9%.

  • Pakistan Ordered to Reopen Vape Shops 

    Pakistan Ordered to Reopen Vape Shops 

    Pakistan’s Lahore High Court granted interim relief to vape shopkeepers in Punjab by ordering the reopening of shops closed by the provincial administration. The decision follows a petition by 74 vape dealers, arguing the closures were illegal and without notice.

    Justice Anwar Hussain said the government failed to justify the crackdown legally and issued a stay order halting further action until a final decision is made. The Punjab government has until July 3 to submit a formal reply.

    The vape shops were sealed following a provincial ban on e-cigarettes announced on June 3 by Chief Minister Maryam Nawaz to “protect youth health.” Petitioners claim the ban is unconstitutional and violates their right to lawful business.

  • Pakistan to Fund University with Tobacco Levy

    Pakistan to Fund University with Tobacco Levy

    Pakistan’s federal government plans to impose a levy on tobacco products to help cover the operational costs of the upcoming Daanish University in Islamabad. The decision was discussed during a project review meeting led by Prime Minister Shehbaz Sharif on June 18.

    The university is being funded by £190 million returned by the UK in a corruption case, with the new tobacco levy intended to support its ongoing expenses. Bids for design and implementation were recently opened, mainly involving firms from China and Turkiye.

    PM Sharif emphasized global education standards, calling for smart boards, e-libraries, and a world-class digital library. He also urged fast-tracking the project and expanding Daanish schools across underserved regions.

  • Pakistan Shifting Toward Open Market Tobacco Pricing

    Pakistan Shifting Toward Open Market Tobacco Pricing

    Pakistan’s Economic Coordination Committee (ECC) directed the Ministry of National Food Security and Research to prepare a roadmap for moving away from the current practice of setting Minimum Indicative Prices (MIPs) for tobacco and transition toward open market pricing, sources told Business Recorder.

    While MIPs serve as a price floor to protect tobacco farmers—particularly when supply exceeds demand—they are not support prices and do not involve government subsidies.

    The ECC noted that shifting to market-driven pricing aligns with the broader government policy of phasing out price controls in favor of demand-and-supply dynamics. However, concerns were raised that cess (a local tax on tobacco), calculated as a percentage of MIPs, could be reduced if open market prices rise above government-set minimums.

    Despite approving revised MIPs for various tobacco types for the 2025–26 fiscal year, the ECC emphasized the need for further deliberation before dismantling the current system. The Ministry was instructed to develop a comprehensive transition plan and present it to the ECC in due course.

  • Pakistan Increases Tobacco Tax 240%

    Pakistan Increases Tobacco Tax 240%

    With cigarette manufacturers in Pakistan already pointing to an excessive Federal Excise Duty (FED) as a reason for a significant decrease in sales and a rising black market, the federal government announced it is imposing a 6% withholding tax on cigarette distributors in the 2025-26 budget, senior sources told ProPakistani. This will be an increase from the previous 2.5% rate.

    The provision for withholding tax rates under Section 153 of the Income Tax Ordinance will be changed to charge the new tax on the gross amount of payment received by distributors when they hand over cigarette sticks to retailers.

    It was previously reported that Pakistan’s government was facing pressure from the World Health Organization to increase its FED further.