A global tobacco company has warned Pakistan against raising cigarette taxes in the next budget. The concern is linked to rising illegal cigarette sales.
BAT officials said higher taxes could increase the size of the black market. They urged the government to maintain stable tax policies.
According to estimates, more than half of cigarettes sold in Pakistan are illegal. This results in major tax revenue losses.
The company stated that past tax hikes did not reduce smoking. Instead, they pushed consumers toward cheaper illegal options.
A large price gap now exists between legal and illegal products. Untaxed cigarettes are significantly cheaper in the market.
Officials acknowledged that enforcement efforts are ongoing. Authorities have seized large quantities of illegal products.
However, experts say enforcement alone is not enough. A combined strategy is needed to control the issue.
The company emphasized long-term policy planning. Stable taxation could help reduce illegal trade and support legal businesses.