PMPKL proclaims monetary outcomes for the half yr ended June 30, 2021

Karachi – Philip Morris (Pakistan) Limited (“Company”) posted after-tax profits of PKR 1,720 million for the six months ended June 30, 2021, compared to after-tax profits of PKR 1,253 million for the same period last year. During that period, the company’s net domestic sales were PKR 9,224 million, an increase of 4.7 percent over the same period last year.

For the six months ended June 30, 2021, the company’s contribution to the Treasury in the form of excise taxes, sales taxes and other government charges was PKR 14,435 million (15.5 percent higher than the same period last year). 60 percent of the semi-annual gross sales.

No change in excise tax rates on cigarettes during the 2020/2021 federal budget turned out to be positive for state revenue and the company’s contribution to the state coffers in the fiscal year (July 20 – June 21) in the form of excise taxes, sales taxes and other government levies that arise amounted to PKR 24.052 million (18.7 percent higher than in the previous financial year from July 19 to June 20). No change in the excise tax rates in the 2020/21 financial year also resulted in price stability for the taxable cigarette industry. However, the issue of non-taxable illicit cigarettes continues to have an adverse impact, with a market share of around 40 percent (down from 23 percent in 2013), resulting in an annual loss of PKR 70-77 billion (estimated) to the national economy leads treasury.

Roman Yazbeck, Managing Director at Philip Morris (Pakistan) Limited shared his views on the announcement: “Although the past year has brought a number of unprecedented challenges due to the pandemic, our entire management team has remained committed to minimizing disruption to ensure business is safe Continuity in compliance with the applicable laws. We appreciate the government’s efforts to take steps to contain the threat posed by the illegal sector, but strict and rigorous enforcement is extremely crucial against tax evasion by the illegal sector in order to level the playing field for lawful taxpaying industries and to improve government revenues . “

While highlighting the need to implement a track-and-trace system, he urged the government to enforce the laws in a solid and regular manner, both verbally and in writing, in order to ensure a level playing field across the tobacco industry. He praised the government’s efforts to introduce controls on goods, including cigarettes, illegally imported from the Azad Jammu & Kashmir (AJK) trade route to ensure proper taxation of goods arriving in Pakistan.

Roman Yazbeck also praised the government’s efforts in enacting a General Sales Tax Ordinance (STGO) of 3. The STGO is an important step in curbing illegal, non-taxable trade. He said strict implementation of this STGO would help eliminate non-taxable illegal cigarette manufacturers who sell cigarettes at a price lower than the minimum price required by tax laws for the purposes of collecting and collecting federal excise taxes.