Islamabad: A delegation of prominent tobacco exporters convened with Federal Minister for Commerce Jam Kamal Khan on Monday to explore strategies for boosting Pakistan’s tobacco exports and addressing challenges related to tariffs and regulatory structures.
The exporters expressed gratitude for the government’s efforts to promote trade and underscored the tobacco industry’s significant role in employment, rural development, and export earnings. They stated that with targeted facilitation, tobacco exports could see substantial growth, aligning with national revenue targets.
A focal point of the discussions was the existing tax structure, which includes a Federal Excise Duty of Rs. 390 per kg, Provincial Excise Duty of Rs. 50 per kg, Federal Tobacco Cess of Rs. 15.15 per kg, and a Provincial Development Cess of Rs. 25 per kg. Exporters highlighted that these cumulative costs, totaling Rs. 480.15 per kg, pose a significant challenge, especially for smaller exporters. They recommended a more competitive taxation model to enhance Pakistan’s global market position.
The delegation advocated for market-based policies, similar to those for other agricultural commodities like sugarcane and cotton. They noted that mandatory annual price adjustments under current regulations could impact export competitiveness.
Minister Khan acknowledged the concerns and reiterated the government’s commitment to balanced, growth-oriented policies. He emphasized that optimal revenue generation stems from both taxation and industry expansion. Khan mentioned that similar taxation concerns have been raised by other sectors, such as beverages.
The exporters also called for the revival of the Pakistan Tobacco Board to support coordinated export promotion and policy facilitation. In response, Khan proposed establishing a Sectoral Council for Tobacco to provide a structured platform for industry dialogue.
The Minister informed the delegation that for the first time, the revenue policy committee operates independently from the revenue collection mechanism, marking a significant step toward informed policymaking.
Exporters appreciated the Minister’s positive response and expressed confidence in the industry’s potential to increase its export footprint with continued government support. Pakistan’s tobacco exports reached USD 158.35 million in the current fiscal year, with growth in markets such as Belgium, UAE, Greece, and the Philippines.
The meeting concluded with a mutual commitment to strengthening public-private cooperation to enhance the country’s tobacco export potential and create a more enabling environment for industry stakeholders.