FBR introduces major crackdown on illegal cigarette production

December 01, 2025 (MLN): Federal Board of Revenue (FBR) has introduced a multi-layered enforcement plan targeting non-duty-paid cigarette production and illegal supply networks, triggering a sweeping nationwide crackdown that has already led to the sealing of two tobacco factories in Khyber Pakhtunkhwa.

The enforcement strategy developed on the prime minister’s instructions aims to disrupt illegal manufacturing, tighten monitoring of production lines, and protect national revenue amid losses estimated at Rs250–300 billion annually due to illicit cigarette trade.

As part of the plan, FBR has deployed more than 200 monitors at manufacturing facilities nationwide and assigned around 120 Pakistan Rangers personnel to Green Leaf Threshing (GLT) units to secure premises and prevent unauthorized production, according to the press release.

The first major action under the plan occurred on November 3, when the Directorate of Intelligence & Investigation-IR Peshawar raided an undeclared godown in Mardan with a magistrate’s warrant and recovered 200 cartons of non-duty paid and non–Track & Trace cigarettes branded Business Class, Red, and Crown.

These brands are registered to Indus Tobacco Company (Pvt) Ltd. Following a formal contravention report submitted on November 21, the Regional Tax Office (RTO) Peshawar proceeded to seal the company’s manufacturing machinery on November 29.

The enforcement team, led by Deputy Commissioner (IR) Arsalan Ali and supervised by the Chief Commissioner, faced armed resistance, allegedly involving company director Bilal Khan, who belongs to a politically influential family in Mardan.

Despite the confrontation and pressure, officers completed the sealing process. Further proceedings are underway under the Federal Excise Act, 2005.

A similar operation was executed the same day against Souvenir Tobacco Company, which was also found involved in manufacturing and removing non-duty-paid cigarettes.

Its machinery was sealed, marking the second major enforcement action in 48 hours.

FBR officials say the crackdown shows a renewed determination to curb large-scale tax theft, eliminate illegal supply chains, and restore compliance in Pakistan’s tobacco sector.

The latest actions suggest more enforcement steps are likely as monitoring intensifies across the industry.

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