Karachi, July 5, 2023 – The tax authorities have issued a stern warning to retailers, informing them of the possibility of a three-year jail term for selling contraband cigarettes. In a bid to curb the sale of unapproved and smuggled goods in the country, the government has recently amended the Sales Tax Act of 1990, introducing new penalties for offenders.
Sources within the Federal Board of Revenue (FBR) disclosed to PkRevenue.com that small retailers found selling smuggled goods, particularly cigarettes, will now be held accountable under the revised law, facing penalties as prescribed by the legislation.
According to the amended tax law, any individual involved in the manufacturing, possession, transportation, distribution, storage, or sale of goods specified by the Board under sub-section (1) of section 40C of the Sales Tax Act of 1990, with counterfeit tax stamps, banderoles, stickers, labels, or barcodes, or without proper tax stamps, banderoles, stickers, labels, or barcodes, will be subject to the following penalties:
(i) The specified goods will be outright confiscated, and the offender will be liable to pay a penalty of either twenty-five thousand rupees or one hundred percent of the tax amount involved, whichever is higher. Furthermore, upon conviction by a Special Judge, the offender may face simple imprisonment for up to three years, an additional fine equal to the tax loss incurred, or both.
(ii) In cases where specified goods are transported with counterfeit tax stamps, banderoles, stickers, labels, or barcodes, or without proper tax stamps, banderoles, stickers, labels, or barcodes, the vehicle used for transportation will be permanently seized.
(iii) For repeat instances of selling specified goods without proper or counterfeit tax stamps, banderoles, stickers, labels, or barcodes, the premises used for such sales may be sealed for a maximum period of fifteen days.
The government’s decision to impose stricter penalties aims to combat the rampant smuggling of unapproved goods, particularly contraband cigarettes. By implementing these measures, authorities seek to deter retailers from engaging in illegal activities and protect the integrity of the market.
It is crucial for retailers to comply with the law and ensure that all goods they sell are properly authorized and meet the required tax regulations. Failure to do so can lead to severe legal consequences, including imprisonment and hefty fines.
The government’s efforts to crack down on the sale of contraband goods reflect its commitment to maintaining a fair and transparent business environment while curbing illicit trade practices.
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