ACT Alliance Hails Government and FBR for Cracking Down on Illegal Trade
On April 29, the ACT Alliance Pakistan expressed significant gratitude towards the Pakistani government and the Federal Board of Revenue (FBR) for their ongoing vigorous efforts against illicit economic activities. This initiative includes a series of successful operations targeting contraband and fake items in key urban centers such as Karachi and Quetta. As a result, authorities have seized merchandise valued at billions of rupees within just a few weeks.
The operation, carried out by law enforcement bodies coordinated by the FBR, led to the confiscation of substantial quantities of untaxed and fake goods. This firmly indicates that both tax avoidance and economic sabotage will not go unpunished anymore.
Musharraf Akram, the National Convener of ACT Alliance Pakistan, stated during an assembly in Islamabad involving media and trade figures that Pakistan’s economy has been damaged by illicit trading activities for far too long. 'Recent crackdowns highlight the government's ability to act decisively,' he remarked. ‘We applaud both the administration and the Federal Board of Revenue for their strong leadership and resolve. Such initiatives should persist and grow broader and more extensive.’
The recovered contraband items included illegal cigarettes as the top earner financially, highlighting the ongoing menace of the black market tobacco business. According to industry evaluations and fiscal data analysis, this rogue cigarette sector reportedly avoids paying more than Rs. 300 billion in taxes each year. This not only undermines the legitimate economic structure but also redirects essential funds away from crucial areas like healthcare, schooling, and public works projects.
The extent of tax avoidance within the cigarette industry is concerning," emphasized Akram. "We encourage the government to prioritize this matter. As legitimate, compliant businesses in the tobacco sector and others continue to decline, unregulated brands are thriving. It is crucial for the authorities to take strong action by implementing tracking systems and cracking down on illegal producers.
According to 2024 estimates, Pakistan suffers from an illegal trade volume of approximately $68 billion annually, equivalent to nearly Rs. 19,040 billion. This figure represents a staggering share of the economy and is feared to rise further if enforcement is not institutionalized as a core element of economic recovery mechanisms. Continued inaction risks entrenching informal markets, weakening investor confidence, and limiting the state's fiscal space.
Recent operations have revealed substantial amounts of contraband tea, unlicensed medications, and drinks that not only dodge taxation but also endanger public health and safety. Although frequently disregarded, these areas cumulatively account for trillions in unpaid taxes and should be integrated into wider law-enforcement initiatives.
The ACT Alliance urged for continuous organizational structure and steadfast political dedication to eradicate the nation's illicit trading system. An integrated approach featuring robust collaboration between federal and provincial authorities, supported by prompt legal actions and consistent public updates, is essential to sustain progress.
These operations mark a pivotal moment, yet only if they lead to new policies will this change persist," stated Mubashir Akram. "We can no longer overlook illegal trade as an insignificant matter; it poses a fundamental economic challenge. Tackling this problem is crucial for Pakistan’s financial autonomy and overall progress.