Islamabad, August 22, 2023 – In a significant crackdown on tax law violations, the Federal Board of Revenue (FBR) has seized a substantial quantity of cigarettes from a prominent manufacturer.
The operation was conducted after it was discovered that the company had been supplying cigarettes below the minimum retail price, a clear breach of tax regulations.
Reliable sources within the FBR revealed that the tax authorities executed the operation against the cigarette manufacturer, which had been knowingly distributing its product at a price lower than the legally mandated minimum.
Pakistan has implemented stringent laws aimed at curbing tobacco use, accompanied by heavy taxation. In this context, the authorities have imposed substantial taxes to discourage smoking.
It was noted that the company, while adhering to all applicable duties and taxes, chose to incur losses by selling its cigarettes below the minimum price. This tactic was seemingly employed to entice consumers into choosing its product over competitors.
The FBR took decisive action, confiscating approximately 650 cartons of cigarettes and launching a comprehensive investigation into the matter.
Sources highlighted that this enforcement action was carried out under the provisions of the Federal Excise Act, 2005. Specifically, Section 19 of the Act unequivocally prohibits the sale of cigarettes below the prescribed retail price. In addition to confiscation, this legislation empowers authorities to impose fines and penalties on entities found in violation.
This move by the FBR underscores the government’s commitment to upholding tax laws and ensuring that businesses adhere to regulations aimed at safeguarding public health. Violations of such laws not only undermine public health initiatives but also result in revenue losses for the government.
The FBR’s action serves as a clear message that businesses operating in Pakistan must comply with all relevant tax and pricing regulations, emphasizing the importance of a level playing field for all market participants and the protection of consumers’ interests. Further developments in this case will be closely monitored as the investigation unfolds.