Tobacco Taxation in Pakistan and AJK: Myth vs. Reality

This Policy Brief was written by the Social Policy Development Centre (SPDC) in Pakistan. This Policy Brief focuses on tobacco taxation in the self-governing Azad Jammu and Kashmir (AJK) region administered by Pakistan. The Policy Brief shows that tobacco production in the AJK region amounts to only one percent of the total cigarette production in Pakistan, and also that cigarettes are subject to the same tax when produced in AJK and brought into Pakistan. The Police Brief notes that issues stemming from AJK are around weak tax administration, but the impact to Pakistan from cigarettes produced in the AJK region is not as sizeable as opponents of tobacco control claim. The Policy Brief further suggests that the Federal Board of Revenue improve its system of monitoring and tracking the supply chain of cigarettes throughout the country to address illicit trade from all sources.