From Claims to Evidence: The Extent of Illicit Trade of Cigarettes in Pakistan

This Policy Brief was developed by Social Policy and Development Centre (SPDC) in Pakistan. The policy brief explores illicit cigarette trade based on the findings of a nationally representative survey of smokers. The results suggest that the overall extent of illicit trade is 35%, which is only 2 percentage points higher than the estimate in 2023 and substantially lower than estimates from the industry. There are regional disparities in illicit trade, with 39% in rural areas, compared to 27% in urban areas. The survey finds that the top 20 brands have a collective market share of 76%, and the majority are manufactured locally and are registered with the Federal Board of Revenue (FBR). Unregistered and smuggled brands, on the other hand, make up 26% of the market. 79% of brands meet the packaging requirements, with a consistent trend of compliance among domestic brands. Tax stamps were found on 57% of packs, an increase from 48% in 2023. This increase reflects the positive effect of implementing a track-and-trace system. 76% of smokers reported paying a price that was above the minimum per-pack price. The brief concludes with policy recommendations to decrease illicit trade, while continuing to raise tobacco taxes to reduce consumption and tobacco-related harm.