Islamabad, February 12, 2026 — Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb held a high-level meeting with a British American Tobacco (BAT) delegation today, led by Ms. Pascale Meulemeester, Regional Director for Asia Pacific, Middle East & Africa, along with senior executives from BAT and Pakistan Tobacco Company (PTC).
The discussion focused on fiscal reforms, enforcement, and the need for a stable Federal Excise Duty (FED) regime to support investment and sector growth.
Fiscal Reforms and Enforcement Measures
Opening the meeting, Senator Aurangzeb highlighted Pakistan’s structural reform agenda aimed at breaking historical boom-and-bust cycles through fiscal discipline, broadening the tax base, and enhanced compliance. He stressed that fiscal sustainability requires equitable taxation, robust enforcement, and decisive action against leakages and illicit activity.
The Finance Minister detailed ongoing tax administration reforms, including AI-enabled CRM systems, production monitoring, and track-and-trace initiatives, which have improved enforcement in sectors like sugar, cement, tobacco, textiles, and beverages. He noted that record seizures of illicit cigarettes and raw materials have been made this year through coordinated operations with customs, inland revenue, provincial authorities, and enforcement units.
BAT Delegation Highlights Policy Concerns
The BAT delegation appreciated government enforcement efforts but highlighted concerns over excise stability, widening price differentials between formal and illicit products, and export competitiveness. They emphasized that a predictable FED regime would encourage formal sector growth, support revenue generation, and facilitate long-term investment planning.
Additionally, the delegation discussed export opportunities, particularly in Saudi Arabia and other global markets, and stressed the need for competitive crop pricing and regulatory alignment to expand Pakistan’s tobacco exports.
Government Response and Policy Outlook
Senator Aurangzeb assured the delegation that sectoral reviews are underway to address policy anomalies while maintaining broader fiscal objectives. He reaffirmed that revenue mobilization is crucial for fiscal stability but emphasized the government’s willingness to engage constructively to ensure effective and sustainable policies.
The Finance Minister also highlighted macroeconomic progress over the past two years, including improved fiscal indicators, declining inflation, strengthened foreign exchange reserves, and enhanced external stability, which provide a predictable environment for investors.
He underlined Pakistan’s long-term growth strategy, anchored in export expansion and sectoral competitiveness, emphasizing the importance of supporting industries like tobacco and related value-added products.
The meeting concluded with a commitment from both sides to continue constructive engagement on enforcement, taxation, and competitiveness to ensure policy coherence and sustainable development in the tobacco sector.