Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial revealed that the government’s recent enforcement campaign in the sugar sector led to a remarkable 39% increase in tax collection, all achieved without altering existing tax rates. He emphasized that this success was due to improved monitoring and stricter compliance measures, which are now being extended to other major sectors.

Highlighting the tobacco industry as a key focus, Langrial said that the government s strategy aims to fundamentally transform tax compliance in this sector, which has long been plagued by evasion and under-reporting. “The story of non-compliance in the tobacco sector will fundamentally change, just as it did in sugar,” he stated.

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The FBR plans to ramp up digital monitoring and implement robust checks to plug revenue leakages in the tobacco industry. Authorities are particularly focused on tracking production volumes, tightening tax enforcement, and curbing the illicit trade of cigarettes, which has significantly hurt tax revenues in the past.

Langrial reiterated that this crackdown is part of a broader tax reform agenda, targeting long-ignored areas of the economy. With enforcement proving effective in the sugar sector, officials are optimistic that similar results can be achieved in tobacco, a move that could significantly boost government revenue without raising tax rates.

On the other hand, there is a proposal of reduction in tax percentage of tobacco products in this budget but different steps will also be taken to bring tobacco industry under tax net.