Enhanced Tobacco Taxation in Pakistan is Likely to Reduce Cigarette Consumption and Even Generate More Revenue

This policy brief was produced by the Social Policy and Development Centre of Pakistan (SPDC) and examines the effects of the June 2019 tax reform in Pakistan. Overall, the brief finds that removal of the third tier of the Federal Excise Duty results in a reduction in cigarette consumption of 9.2-18 percent, and an increase of tax revenue from both the Federal Excise Duty and General Sales Tax by Rs 0.5-15 billion over the current fiscal year (2019-2020).