FBR tells Senate panel tobacco tax evasion stands at Rs 40 billion, not $1 billion
ISLAMABAD: The Federal Board of Revenue (FBR) informed a Senate sub-committee on Thursday that estimated tax evasion in the tobacco sector is around Rs 40 billion annually, significantly lower than the previously cited figure of $1 billion.
The briefing was given during a meeting of the Senate Standing Committee on Interior and Narcotics sub-committee, chaired by Senator Saifullah Abro. The committee reviewed issues related to smuggling, tax evasion, misuse of tax exemptions, and enforcement actions.
During the session, Senator Abro raised questions regarding government claims in public awareness campaigns that suggested tobacco-related tax losses of $1 billion. FBR officials clarified that their current estimates place the figure at approximately Rs 40 billion.
Officials also stated they were not aware of the nationwide campaign being run on tax evasion in the sector and noted the need for consistency in public messaging.
Senator Abro expressed concern over the discrepancy, stating that public awareness campaigns should be based on verified and accurate data. He directed relevant authorities to report the matter and ensure correction where necessary.
The committee was also informed that the FBR has taken action against several tobacco manufacturing units in connection with alleged tax fraud. Members were briefed on regulatory measures and enforcement steps being taken in the sector.
Separately, the panel reviewed allegations involving the diversion of tax-exempt imports, which were reportedly being used elsewhere, resulting in revenue losses.
The Federal Investigation Agency (FIA) also updated the committee on an ongoing case involving the theft of cigarette cartons, with lawmakers calling for strict action against those responsible.
The committee instructed all concerned departments to submit detailed reports at the next meeting and emphasized stronger coordination to address smuggling and tax evasion issues.
