Khyber Pakhtunkhwa Seeks to Implement Provincial Excise Duty on Tobacco

Peshawar, In a meeting with officials from Pakistan Tobacco Company, Khyber Pakhtunkhwa’s Finance Advisor Muzamil Aslam discussed plans to impose a provincial excise duty on tobacco, a move that could shift revenue control from the federal to the provincial government. This development comes amid discussions on increasing tobacco cess for development purposes within the province.

According to Directorate General Information and PRs – Khyber Pakhtunkhwa, the finance advisor emphasized that the right to collect excise duty on tobacco traditionally belongs to the province but has been managed by the federal government as federal excise duty. The proposed shift aims to rectify this by introducing a bill to enforce provincial excise duty on tobacco products soon. The delegation from Pakistan Tobacco Company raised concerns about potential double taxation that could affect the industry due to this change.

During the meeting, Advisor Aslam also mentioned that the revenues from the increased tobacco cess would be allocated to developmental projects in the region, while funds from the new excise duty would specifically benefit the health sector. He highlighted the disparity in the current system where tobacco revenue generated in Khyber Pakhtunkhwa is utilized in other provinces, describing it as an injustice that needs correction following the eighteenth amendment.