ISLAMABAD - Members of a parliamentary panel yesterday opposed a proposal of increasing tax on tobacco from the existing Rs 10 per kg to Rs 500 per kg.
The proposal was put before the National Assembly Sub-Committee of the Special Committee on agricultural products headed by convener Shandana Gulzar Khan where it faced severe criticism.
According to the FBR representatives who briefed the committee, the proposal was given by multinational tobacco companies.
Malik Ihsan Ullah Tiwana, member of the committee, opposed the proposal and said imposition of such heavy taxes will overburden the farmers (of tobacco).
Economic expert Ikramul Haq said that the FBR should take a strict action against all those who were not paying taxes under the existing tax laws.
Highlighting the issues related to tobacco industry, he said that carbon and sugar taxes are imposed all across the world but the ministry of law and justice has rejected the proposal by declaring it a provincial subject.
Haq also said that the FBR has imposed 5 percent advance tax on tobacco but it was not being collected.
However, representatives from Pakistan Tobacco Board informed the committee that entire record regarding tax collection was available with them.
In response the FBR said that they lacked resources for the monitoring of the tobacco industry.
Tobacco farmers and industrial workers have written letter to National Assembly Speaker against the proposal.
The letter explained that multinational companies are trying their best that the government enhances advance tax on tobacco which will annihilate the local industry and help establish their monopoly.
The farmers said they fear “exploitation” at the hands of the multinational companies once their monopoly is established.