ISLAMABAD, Pakistan: Following the tabling of “The Finance (Supplementary) Bill, 2023″ in the National Assembly by the Minister for Finance and Revenue Senator Ishaq Dar on February 15, the prices of cigarettes have already soared by up to 100 percent; even though the proposed measures have yet to get a node from the Lower House.
In the Supplementary Finance Bill, the finance minister proposed additional taxes and duties of Rs 170 billion on luxury items including cigarettes.
It was proposed to enhance the General Sales Tax (GST) on luxury items from 17 percent to 25 percent as well as to raise the Federal Excise Duty (FED).
Reports said that with the introduction of the proposed bill, the prices of almost all cigarette brands including Marlboro, Benson and Hedges, Gold Leaf, Capstan, Gold Flake, Dunhill, Embassy, and Morven Gold etc have already been raised to 100 percent.
They suggested that if a pack of 20 cigarettes was earlier being sold at Rs 250, now it is available for Rs 500.
The question stays, if prices are not officially increased yet who is earning from that?
Why is there a delay in Mini-Budget approval after announcement, giving a chance to black market, govt is not earning either.
Also, 40% market share is illegal/black cigarettes why no action
— Economy of Pakistan (@Pakistanomy) February 18, 2023
Prior to presenting the mini-budget in the National Assembly, the federal government approved the Finance (Supplementary) Bill, 2023 on February 14.
While on the same, the Federal Board of Revenue (FBR) notified the FED increase on expensive cigarette brands from Rs 6.5 per cigarette to Rs 16.5 – an increase of 153 percent while for less expensive brands, per stick increase is from Rs 2.55 to Rs 5.05 – an increase of 98 percent.
The industry analysists said that 143 percent massive hike of FED rates on cigarettes will cause around a 250 percent increase in the prices of cigarettes.
They also feared that it will also effectively favour the already vast illicit cigarette manufacturers in Pakistan.