Cigarette firms have improved sales, pay less tax: NAB report

ISLAMABAD: An initial inquiry by the National Accountability Bureau (NAB) has said the three-tier tax system has allowed cigarette makers to pay reduced excise duties and improve sales. It has also alleged that the Federal Board of Revenue (FBR) was not cooperating with the inquiry.

The initial inquiry has initiated a probe into Rs33 billion worth of tax benefits obtained by two main multinational cigarette manufacturing companies through a change in the tax slab structure.

The inquiry was initiated by NAB Rawalpindi in April 2018 but FBR is yet to appoint a focal person to assist the NAB team.

Says FBR not cooperating for inquiry into tax benefits obtained by two multinational cigarette manufacturing companies

“NAB has already taken up the matter and an initial investigation against cigarette manufacturers has begun,” NAB Rawalpindi spokesperson Mohammad Bilal said.

He added that the Public Accounts Committee (PAC) had also in its meeting on May 23 recommended a special report by the Auditor General of Pakistan on causes of decline in tax collections from the tobacco sector.

Mr Bilal said it will take NAB two months to verify the record and some four months to conduct an investigation under set procedure “if the relevant department cooperates with the investigations”.

“It has been revealed that after the introduction of third tier tax structure in May 2017 the two major players had shifted their famous brands to the lowest tax slab and sold their cigarettes with 50pc reduction in federal excise duty, which enhanced their sales but revenues plunged,” the NAB inquiry says.

A similar observation was made in the audit report over the matter which was submitted to PAC.

Against the previous two-tier structure, FBR had introduced a new tier with only Rs800 as federal excise duty, which is 50pc less than the lowest rate previously.

The FBR did not place a restriction on shifting from the second to the lowest slab which gave Rs32.9 billion worth of benefits to two cigarette manufacturers, the report says.

FBR has therefore provided a safe way for the two multinationals to pay less tax through the three-tier structure.

Pakistan has one of the largest numbers of tobacco users in the world with around 11pc of its total population being smokers.

The three-tier system was introduced when Ishaq Dar was the finance minister and the Ministry of National Health Services had also asked FBR to withdraw the third tier of federal excise duty so widespread use of cigarettes is discouraged.

Published in Dawn, September 1st, 2018



~ Shop by Category ~


Mens Fashion in Pakistan  Mens Latest Fashion in Pakistan  Mens Fashion Accessories Online Shopping in Pakistan  Mens Belts Online Shopping in Pakistan  Cufflinks Online Shopping in Pakistan  Mens Perfumes Online Shopping in Pakistan  Mens Sunglasses Online Shopping in Pakistan  Mens Wallets Online Shopping in Pakistan  Mens Watches Online Shopping in Pakistan  Mens Clothing Online Shopping in Pakistan Mens Wester Clothing Online Shopping in Pakistan  Export Stock Lot & Export Leftover in Pakistan  Mens Winter Collection 2019-2020  Mens Hoodies & Jackets Online Shopping in Pakistan  Mens Jeans Online Shopping in Pakistan  Mens Pants Online Shopping in Pakistan  Mens Shirts Online Shopping in Pakistan  Mens T-shirts Online Shopping in Pakistan  Mens Pakistani Clothing Online Shopping in Pakistan  Mens Nightwear & Undergarments Online Shopping in Pakistan  Mens Bathrobe Online Shopping in Pakistan  Mens Nightwear Online Shopping in Pakistan  Mens Pajamas Online Shopping in Pakistan  Mens Undergarments Online Shopping in Pakistan
Ladies Fashion Online Shopping in Pakistan  Ladies Latest Fashion Online Shopping in Pakistan  Womens Accessories Online Shopping in Pakistan  Ladies Handbags & Purses Online Shopping in PakistanLadies Perfumes Online Shopping in Pakistan  Ladies Sunglasses Online Shopping in Pakistan  Ladies Watches Online Shopping in Pakistan  Ladies Clothing Online Shopping in Pakistan  Pakistani Dresses Online Shopping in Pakistan  Pakistani Dresses Latest Designs & New Arrival  2018 Collection Pakistani Dresses in Pakistan  2019 Collection Pakistani Dresses Designs  Abaya & Hijab Online Shopping in Pakistan  Ladies Kurti Online Shopping in Pakistan  Original Dresses Online Shopping in Pakistan  Replica Dresses Online Shopping in Pakistan  Stitched Dresses Online Shopping in Pakistan  Unstitched Dresses Online Shopping in Pakistan  Bridal Dresses Online Shopping in Pakistan  Designer Dresses Online Shopping in Pakistan  Eid Collection Pakistani Dresses 2019-2020  Engagement Dresses Online Shopping in Pakistan  Mehandi Dresses Online Shopping in Pakistan  Nikah Dresses Online Shopping in Pakistan  Party Dresses Online Shopping in Pakistan  Walima Dresses Online Shopping in Pakistan  Wedding Dresses Online Shopping in Pakistan  Chiffon Dresses Online Shopping in Pakistan  Embroidered Dresses Online Shopping in Pakistan  Lawn Dresses Online Shopping in Pakistan  Linen Dresses Online Shopping in Pakistan  Net Dresses Online Shopping in Pakistan  Satin Dresses Online Shopping in Pakistan  Silk Dresses Online Shopping in Pakistan  Velvet Dresses Online Shopping in Pakistan  Indian Dresses Online Shopping in Pakistan  Ladies Summer Collection Pakistani Dresses 2019-2020  Ladies Winter Collection Online Shopping in Pakistan  Lingerie Online Shopping in Pakistan  Lingerie New Arrival 2019-2020 Collection  Ladies Bathrobe Online Shopping in Pakistan  Bikini Online Shopping in Pakistan  Bra Online Shopping in Pakistan  Bra Panty Sets Online Shopping in Pakistan  Panty & Thongs Online Shopping in Pakistan Bra by Color  Bra by Size  Bra by Types - Types of Bra  Body Shaper Online Shopping in Pakistan  Camisole Online Shopping in Pakistan  Sexy Lingerie Online Shopping in Pakistan  Nightwear Online Shopping in Pakistan  Nighty Online Shopping in Pakistan  Bridal Nighty Sets Online Shopping in Pakistan  Body Stocking & Leg Stocking Online Shopping in Pakistan  Tights Online Shopping in Pakistan  Ladies Undergarments Online Shopping in Pakistan