Crackdown against tax evading cigarette sector will continue across Pakistan: Asif

Defence Minister Khawaja Asif has said that enforcement operations against tax evasion in the cigarette sector would continue, warning that illegal cigarette manufacturers are causing massive losses to the national exchequer through large scale tax evasion. During the current financial year revenues collection from the cigarette sector has increased by approximately Rs. 35 billion to Rs. 40 billion due to the crackdown operation against illegal cigarette manufacturing and smuggling. Speaking on the issue of illicit cigarette production and tax evasion, Khawaja Asif said that tax evading cigarette manufacturers were previously evading around 30 to 35 percent of taxes collected from this sector, but according to him the tax evasion figure had now risen to nearly 60 percent. Khawaja Asif strongly criticized a few parliamentarians linked with tax evading cigarette sector and said that some of the parliamentarians linked remained in power and are still sitting in important positions. Whenever inquiries against tax evasion in the tobacco sector are initiated, the same parliamentarians linked with tax evading cigarette factories end up influencing the process by heading these platforms,” he added. He further added that maintaining the current taxation level on cigarettes, instead of increasing tax ratios, could further improve revenue collection. “When taxes are increased beyond a certain point, it encourages smuggling and tax evasion,” Asif further added that consistent enforcement actions are also necessary to sustain gains in revenue collection. After the crackdown operation, illegal cigarette manufacturing units, once operated in certain areas, had now spread across different parts of Pakistan following enforcement raids. He alleged that operators are now setting up factories in remote locations, including farms and private properties, while sharing profits with the landowners. He reiterated that the crackdown against tax evasion and illegal cigarette production would