In 2018, Pakistan had emerged as the topmost country in Asia with illicit cigarette trade that amounted to a whopping 32.6 billion cigarettes annually.
Oxford Economics reports that 41.9% of total cigarette trade is illegal. Phillip Morris International has added to this that the illegal trade is costing Pakistan more than Rs. 44 billion in taxes annually.
Moreover, Prime Minister Imran Khan had called for a nationwide crackdown against sale of illicit cigarettes on priority according to a letter issued by the PM office. According to the letter, the Ministry of National Health Services, Regulation and Coordination and Federal Board of Revenue have been ordered to submit a monthly progress report.
Furthermore, it was found that open cigarettes are available in the market without the mandatory 60% Graphic Health warning. They are priced at Rs 20-35, whereas the government-mandated minimum price is at Rs 62.76.
According to Business Recorder, the market share of illicit cigarettes, the majority of which are local, stands at 33% while the share of the tax-paying industry is 67%, but only 2% is being contributed by the local manufacturers.
So, how do we tackle the growing crisis of smuggling of cigarettes?
Here are 5 ways to help curb the exceeding and problematic concern of illegal trade in illicit cigarettes in Pakistan that the government can consider:
1. Imply Heavier Penalties & Punishments Including Imprisonment Against Illegal Operators
Heavy fines and penalties including imprisonment of the smugglers, suppliers, and even the consumers can bring down the number of open cigarettes being circulated. If the government makes imprisonment a part of the penalty then this will help bring down the number of individuals involved.
2. Task Force Dedicated to Illegal Cigarette Trade
The government can consider forming a task-force made of high-integrity officers who will specifically work on the task at hand. The force will have representatives of all involved authorities and departments to increase the coordination and have strategic plans which will prove effective.
3. Use Modern Technology at Ports
Technology has proved to be very useful in a lot of ways. Using scanners is also an initiative that can be taken at ports to help cut down the number of cigarettes being illegally imported or smuggled away. Trained offices under the task-force can be assigned to these ports as well for visual lookouts.
4. More Awareness Campaigns
The government can fund more awareness campaigns in public places to help create awareness. A group of speakers can also go to universities and colleges as well as different communities and areas to share how cigarettes can be harmful to one’s health.
5. Tax Harmonization
The Pakistani government can consider equalizing tax rates across neighboring jurisdictions to lower an imbalance in cigarette prices across borders.
What other precautions the government can take to control illicit tobacco or cigarette trade? Share with us in the comment below.
