Inland Revenue Enforcement Network committed to curbing tax evasion in tobacco sector

At the end of the year 2016, the market share of legitimate and illegal cigarette trade in Pakistan stood at 60% and 40% respectively in Pakistan. This menace was causing a loss of an estimated Rs 40 billion annually to the national exchequer. Taking strict notice of tax evasion in the tobacco sector, Federal Board of Revenue constituted a special enforcement network titled as Inland Revenue Enforcement Network. The main objectives of the IR enforcement network are to identifying core stakeholders in cigarette/tobacco sector, with reference to tax contribution, evasion of duty/taxes, tax jurisdiction and revenue generation.
IR enforcement network is also responsible for developing and implementing strategies to combat illegal cigarette trade in Pakistan. It is also responsible to strengthen field squads and regional enforcement hubs and providing them legal advice so that they can work more effectively.
IR enforcement network has developed and executed strategy to combat illegal cigarette trade in Pakistan especially to address foreign non-duty paid / counterfeit brands, local manufactured non-duty paid cigarettes, dumping by AJK cigarette manufacturers, cigarette manufacturing in non-taxable territories ie FATA/PATA, tracking alternate/mobile cigarette manufacturing facilities, monitoring of Dormant cigarette manufacturing units, pooling of IR resources (human and physical) for joint enforcement initiatives.
For effective implementation of the strategy, IR enforcement network had been divided into eight regional enforcement hubs. ie; Enforcement Hub South (LTUs, RTUs Karachi), Enforcement Hub Sindh (RTOs Hyderabad, Sukkur), enforcement hub Balochistan (RTOs Balochistan), Enforcement Hub South Punjab (RTOs Multan & Bahawalpur), Enforcement Hub Central Punjab (RTOs Faisalabad & Sargodha), Enforcement Hub Lahore (LTUs & RTOs Lahore, Gujranwala, Sialkot), Enforcement Hub Islamabad (LTU Islamabad, RTOs Islamabad, Rawalpinid & Abbotabad) and Enforcement Hub KPK (LTUs, RTOs KPK).
During last one year, enforcement hubs of IREN have conducted lots of successful raids and activities and seized approx. 1.63 billion non-duty paid cigarette sticks and raw material. Enforcement Hub South has seized approx 19 million non-duty paid cigarettes sticks, Enforcement Hub Sindh has seized approx 25 million non-duty paid cigarettes sticks, Enforcement Hub South Punjab has seized approx. 5.8 million non-duty paid cigarettes sticks, Enforcement Hub Central Punjab has seized approx. 42 million non-duty paid cigarettes sticks. While Enforcement Hub Lahore has seized approx. 48.96 million non-duty paid cigarettes sticks, Enforcement Hub Islamabad has seized 90 million non-duty paid cigarettes sticks seized and 3100 bales of processed tobacco seized, which is sufficient to produce over 400 million sticks. Similarly, Enforcement Hub KPK has seized approx 30 million non-duty paid cigarettes sticks, huge quantity of filter rods for tax-evaded cigarettes sticks and 160000 kg non-duty paid tobacco.