Non-duty paid tobacco brands flood market

KARACHI: In the year 2012, 66.5 billion cigarettes consumed in 11 Asian countries were illicit. With 86.3 percent, the domestic illicit cigarette volumes and consumption of illicit cigarettes were highest in Pakistan whereas the Non-Domestic Illicit was 13.7 percent. This scenario resulting in Tax Revenue losses of about more than $250 million in 2012 only. These were the outcomes of the study, ‘Asia-11 Illicit Tobacco Indicator 2012’ conducted by Oxford Economics. Illicit trade manifests itself in three major and interrelated ways-smuggled, counterfeit and local tax evaded products. It is a global phenomenon, covering all continents and high and low income countries alike.  Cigarettes, being highly taxed, easy to transport and possessing a lucrative risk to reward ratio are among the world’s most illegally trafficked goods. The study conducted by Oxford Economics, is the first quantitative benchmark for governments in the region to track and understand the problem. The study covered Australia, Brunei, Hong Kong, Indonesia, Malaysia, Pakistan, Philippines, Singapore, Taiwan, Thailand, Vietnam and demonstrates that illegal tobacco significantly impacts developed and developing countries alike-occurring in jurisdictions with both high and low tax and price levels, as well as in those with strong reputations for law and order.