Publications

This paper underscores the importance of updating the baseline data underpinning Pakistan’s 7th NFC Award, which currently relies on outdated census figures and administrative boundaries. To more accurately reflect recent demographic and fiscal developments, it recommends a technical recalibration using updated indicators while maintaining the existing formula. As deliberations for the 11th NFC ..

PAKISTAN - TOBACCO FACT SHEET 2006 Advancing Public Health and Strengthening Fiscal Stability: Cigarette Tax Proposal for 2026-27 ..

Illicit cigarette trade undermines both fiscal revenues and public health objectives. This study provides the first systematic estimate of revenue losses attributable to tax evasion and smuggling, revealing how weak enforcement and market distortions drain government resources. It calls for evidence-based reforms to strengthen excise administration, close loopholes, and counter industry narratives ..

Official estimates based on the HIES 2024-25 place Pakistan’s poverty incidence at 28.9%. In contrast, SPDC’s analysis reveals a far higher rate of 43.5%, driven by methodological refinements and highlighting a disproportionate rise in urban poverty. This policy brief summarizes the findings from SPDC’s report entitled Empirical Evidence of Upsurge in the Poverty Numbers: Pakistan, 2025 Scen ..

Pakistan faces an ongoing debate regarding the illicit tobacco trade. Tobacco industry leaders assert that high taxes promote illegal trade because of insufficient tax enforcement. This argument has persistently been used to make a case for reducing the excise tax rate on cigarettes. This controversy has intensified during the last few months, after a retailers’ survey report1 was launched in Fe ..

Higher Taxes Needed to Make Cigarettes Less Affordable and Increase Revenue ..

The Sustainable Development Goals (SDGs) represent a global agenda adopted by countries of the world in 2015 to address key development challenges and achieve sustainable development by 2030. Although progress varies significantly across countries and regions, the 2024 assessment suggests that the world is significantly off-track in achieving the 2030 Agenda. Out of 135 targets, only 17 percent ar ..

The illicit tobacco trade is a contentious issue in Pakistan, with the government concerned about lost revenue due to tax evasion and the industry arguing that high taxes lead to increased illicit due to lax tax administration. This debate has recently intensified, with the industry propagating that the tax hike in February 2023 has significantly fueled illicit trade. ..

Even though the Government of Pakistan was under tremendous pressure to increase taxes in various sectors to generate additional revenue for financing the fiscal deficit in the fiscal year 2024-25, it surprisingly spared the cigarette industry from any tax hike. The Finance Act 2024 passed by the National Assembly on June 28, 2024 remained silent on enhancing the rate of Federal Excise Duty (FED) ..

In response to public health concerns surrounding high smoking prevalence, the Pakistani government enacted a substantial increase in the Federal Excise Duty (FED) on cigarettes during the fiscal year 2022-23. This policy intervention, with the most notable rise of around 150 percent occurring in February 2023, resulted in a corresponding increase in cigarette prices. ..

The federal budget for fiscal year 2024-25 has been presented against the backdrop of a moderately improved macroeconomic environment compared to the previous fiscal year and a colossal fiscal challenge ahead. ..

Recovering Healthcare Costs and Saving Lives: An Urgent Call for a Tobacco Tax Increase in the Budget 2024-25 ..

Pakistan's economy is confronted with a severe economic crisis, which is characterized by high levels of inflation, low economic activity, low foreign reserves, a depreciating currency, and enormous public finance imbalances. The prevailing political uncertainty is further contributing to the problem. The Federal Budget 2023-24 was presented against this challenging macroeconomic backdrop and a co ..

During the current fiscal year, the government has demonstrated its commitment to curbing cigarette consumption in Pakistan by increasing rates of Federal Excise Duty (FED) on cigarettes. ..

The current fiscal year has been unusual for cigarette tax policy in Pakistan. The government took commendable measures of substantially increasing the rates of Federal Excise Duty (FED) on cigarettes, which was unprecedented in two aspects. First, the tax changes were made three times during the ongoing fiscal year. Second, the last rise was around 150 per cent, the largest one-time increase in e ..

This policy brief summarizes the results of a nationally representative survey of more than 7,500 current and past smokers. The research objective was to study smokers' consumption behaviour in response to tax-induced price changes. ..

Following the tax measures introduced in the Finance Act 2022 on June 30, 2022, the Government of Pakistan promulgated Tax Law (Amendment) Ordinance 2022 on August 23, 2022, to generate additional revenue from various sectors of the economy, including the tobacco sector. Under the Finance Act 2022, the average rate of Federal Excise Duty (FED) on cigarettes was increased by 12.5 percent, which was ..

Under the Finance Act 2022, passed on June 30, 2022, in the National Assembly of Pakistan, the government revised the Federal Excise Duty (FED) rates on domestically-produced cigarettes. Keeping the two-tier system intact, the FED rates increased by 13.5 percent and 12.1 percent for high-priced and low-priced brands, respectively. The weighted average increase in FED rate is estimated to be 12.5 p ..

Tobacco use continues to remain a major public health problem in Pakistan. The number of adults (age 15+) currently using tobacco in any form is estimated to be 31 million,1 accounting for nearly one-fifth of the adult (age 15+) population. Worldwide, tobacco use is a leading cause of preventable deaths by non-communicable diseases, including cancer, chronic respiratory diseases, and cardiovascula ..

Under the Finance Bill 2022, presented on June 10, 2022, in the National Assembly of Pakistan, the government proposed to revise the Federal Excise Duty (FED) rates on domestically-produced cigarettes. Keeping the two-tier system intact, the FED rates increased by 7.7 percent and 12.1 percent for high-priced and low-priced brands, respectively. This is a long-waited increase since the rates were l ..

In Pakistan, domestically produced cigarettes are subject to two major indirect taxes – the Federal Excise Duty (FED) and the General Sales Tax (GST). The FED accounts for almost 80% of the revenue from the sector. Both taxes are collected at the production stage. The cigarette manufacturing sector in Pakistan is an example of an imperfect market, with only three companies dominating domestic pr ..

Raising Tobacco Tax Rates to Promote Public Health and Increase Revenue: Policy Options for Budget 2022-23 ..

The prevalence of tobacco use continues to remain one of the critical development challenges in Pakistan as about 30 million adults—19.1 percent of the adult population—currently use tobacco in any form. Tobacco use is estimated to be associated with premature deaths of over 160,000 people in Pakistan in 2017.2 Cigarette taxation is an essential element of tobacco control policy in the country ..

Pakistan is a signatory to the WHO Framework Convention on Tobacco Control (FCTC), which requires the country to implement taxation and pricing policies on tobacco products to reduce their consumption. Effective tobacco taxation is considered the most effective means of reducing tobacco consumption and generating revenues for public health promotion. However, tobacco tax policies in Pakistan have ..

Pakistan is a high tobacco-burden country where more than 29 million adults currently use tobacco in any form. Estimates based on Pakistan’s Household Integrated Economic Survey (HIES) 2018–19 indicate that tobacco is consumed in more than 45% of the households in the country — the ratio is 49% and 38% in poor and rich households, respectively. ..

Global evidence has established that tobacco use is a leading cause of deaths due to non-communicable diseases (NCDs), including cancers, chronic respiratory diseases, and cardiovascular diseases.1 Pakistan is not an exception to this situation: it has a high burden of tobacco use with resulting high costs from tobacco-related morbidity and mortality. With a prevalence rate of 19.1 percent, about ..

Social Policy and Development Centre (SPDC) is undertaking a series of informed and interactive dialogues, on various topics covering a range of the drivers of violent extremism (VE) in Pakistan. The aim of the project is to increase understanding of violent extremism related issues among government representatives and different stakeholders, besides increasing the capacity of civil society to org ..

Increasing the price of tobacco products through higher taxation is widely acknowledged as the most effective way to reduce tobacco consumption. Although evidence shows that tobacco taxation does not have a significant impact on the illicit trade of cigarettes1, a common argument of the cigarette industry in Pakistan is that higher taxes drive illicit trade. The industry claims that smokers seek o ..

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Social Policy and Development Centre (SPDC) is undertaking a series of informed and interactive dialogues, on various topics covering a range of the drivers of violent extremism (VE) in Pakistan. The aim of the project is to increase understanding of violent extremism related issues among government representatives and different stakeholders, besides increasing the capacity of civil society to org ..

Social Policy and Development Centre (SPDC) is undertaking a series of informed and interactive dialogues, on various topics covering a range of the drivers of violent extremism (VE) in Pakistan. The aim of the project is to increase understanding of violent extremism related issues among government representatives and different stakeholders, besides increasing the capacity of civil society to org ..

Tobacco taxation is widely acknowledged as a robust policy instrument to scale back tobacco consumption. Effective and optimal tobacco taxation can serve the dual objective of public health promotion and revenue generation. The effectiveness of this tool, however, depends heavily on the mechanisms of tax collection. Read more... ..

Pakistan has a chequered history in terms of taxation on cigarettes. The Federal Excise Duty (FED) is the major tax levied on cigarettes in the country and its structure is based on a price-tier system. In 2013, a two-tier structure of FED based on the range of retail prices was introduced. In 2017, FED structure was modified to a three-tier structure, with a new tier for the low-price brands, in ..

Role of Tobacco in Pakistan's Economy: An untold Reality ..

A Reflection on the State of Economy and Federal Budget 2018-19 ..

Agenda for Devolved Tax Collection ..

Fiscal Implications of 7th NFC Award ..

Empowering Local Government – The Road to Inclusive and Sustainable Development ..

Tobacco Control in Pakistan: The Impact of Tax Reduction Policy ..

A Reflection on the State of Economy and Federal Budget 2017-18 ..

Key Issues in the State of Economy ..

Agenda for the 8th NFC: Lessons from the 7th NFC Award, Post- 7th NFC Development and Emerging Issues ..

The Privatization Program ..

Women at Work ..

Social Impact of the Security Crisis ..

The Elimination of Textile Quotas and Pakistan-EU Trade, Policy Brief, April 2007 ..

The report is an effort to objectively present the situation with respect to the state of the economy. It acknowledges the gains made over the year, but cautions against certain misleading and, consequently, overly optimistic judgements. It identifies the areas where weaknesses are pronounced and where policy shifts are called for in order for the process of economic revival to be generated and su ..

On the Estimation of An Absolute Poverty Line: An Empirical Appraisal ..

A National Poverty Reduction Strategy and the Role of Donors ..

Macroeconomic Framework for Debt Management ..

Revamping the SAP ..

Statement to the Commonwealth Delegation ..

Unsustainability of the Balance of Payments ..

Broad-Basing of GST: The Strategy for Transition ..

Provincial Resource Mobilisation ..

Financial Sustainability of NGOs: Proposal for 1998-99 Federal Budget ..

Political Economy of Tax Reforms: The Pakistan Experience ..

Ninth Five Year Plan (1998-2003): Issues Paper ..

Implication of the TOR of the New NFC ..

Provincial Budgets of 1995-96 ..

Fiscal Effort by Provincial Governments in Pakistan ..

Switchover to Ad Valorem Octroi Rates at Dry Ports ..

Rationalisation of Octroi Rates ..

User Charges in Health ..

Sindh Government Budget of 1993-94 ..

User Charges in Education ..

Sales Taxation of Services by Provincial Governments ..

Rationalisation of Stamp Duties on Financial Assets and Transactions ..