PTC Concerned over Lack of Track and Trace System Enforcement

Staff Report

The legal tobacco industry has expressed deep concerns over the lack of track and trace system enforcement to stop the sale of illegal and smuggled cigarettes in the country.

The Track & Trace System (TTS) implemented by the FBR was failing, as there was a rising incidence of fake stamps being affixed to counterfeit packs of prominent cigarette brands.

Senior officials of the tobacco industry here on Monday decried lack of enforcement measures in the sector expressing concerns over the sustainability of this business as the Pakistani markets were being flooded with smuggled and counterfeit cigarettes.

Taking to the media Pakistan Tobacco Company (PTC) officials said that the recent data released by the Pakistan Bureau of Statistics shows that the Large Scale Manufacturing (LSM), has tobacco industry faced a decline of around 40 percent, from July to November 2023.

Qasim Tariq, Senior Business Development Manager, PTA, said that cigarette consumption has remained stagnant and it was visible just by visiting any market across the country that cheap smuggled and counterfeit local brands were available.

“Around 850 million counterfeit cigarette sticks are currently being sold all across Pakistan including major cities, this figure stands equivalent to 42.5 million packs featuring fake stamps, resulting in substantial loss of approximately Rs5.7 billion to Pakistan”, he said.

He said that rising counterfeit draws serious questions on the efficacy of the much-lauded track and trace system which is yet to be implemented across local cigarette manufacturers in Pakistan and Azad Jammu & Kashmir (AJK).

He said that the representatives urged the Law Enforcement Agencies (LEAs) with jurisdiction to conduct extensive enforcement at the retail level against this rising menace. Mighty Illicit Tobacco Sector Stealing over 50% Tax Potential

The PTC officials referred to the report of FBR submitted to the parliamentary committee in 2019 that illicit cigarette trade was more than 36.2 percent in the country.

The PTC officials showed cigarette packs with fake T&T stamps that were available in the market.

Mr Qasim highlighted that revenue collections declined between 2012 – 2016 after the government switched to a 2-tier structure from a 3-tier Structure which had been implemented in Pakistan since 1992