ACT Alliance Pakistan has lauded the Federal Government’s consistent and commendable actions to curb illegal trade and reinforce tax enforcement across the country following the release of the latest independent report by the Policy Research Institute of Market Economy (PRIME), which estimates annual revenue losses of Rs3.4 trillion due to illegal trade.
Speaking on behalf of ACT Alliance Pakistan, Mubashir Akram, National Convenor, welcomed the intensifying efforts by federal and provincial agencies to address the scale of economic losses inflicted by smuggling, tax evasion, and market distortions caused by the informal economy.
“The government deserves recognition for its ongoing enforcement operations despite facing fiscal, infrastructural, and operational constraints,” said Akram. “From Quetta to Karachi, law enforcement has intercepted large consignments of smuggled goods. These actions are vital, especially when the scale of economic loss runs in trillions of rupees annually.”
The PRIME report, “Combatting Illicit Trade in Pakistan,” estimates that nearly 30% of the Rs3.4 trillion annual tax loss is attributed to the misuse of the Afghan Transit Trade facility. In contrast, tobacco smuggling alone is estimated to cause losses exceeding Rs 300 billion annually. The report also points to Rs270 billion in losses from petroleum smuggling, Rs106 billion from tires, Rs65 billion from counterfeit medicines, and over Rs10 billion from smuggled tea.
Akram stated, “This is not merely an issue of revenue loss; it is a matter of economic sovereignty. Illegal trade undermines formal businesses, erodes investor confidence, and affects our capacity to fund essential public services. Cigarettes, petroleum, and real estate have become hotbeds of informal activity that drain the public treasury and distort fair market practices.”
He continued, “Pakistan’s economy cannot afford to carry the burden of an informal economy that jeopardizes formal growth and lawful enterprise. The government’s renewed attention to enforcement is timely and necessary, and we stand firmly with its resolve.”
The report underscores systemic challenges, including weak implementation of Track and Trace Systems (TTS), porous borders, outdated customs systems, and limited coordination among regulatory agencies. A study by the Institute of Public Opinion and Research, cited in the report, revealed that only 19 out of 264 cigarette brands complied with TTS regulations, leaving over half the market untaxed and unregulated.
Akram noted, “We acknowledge the government’s complexities, from infrastructural bottlenecks to high customs duties and regulatory fragmentation. But we must persist. Any rollback in enforcement could prove detrimental to national recovery and compromise the sustainability of macroeconomic gains achieved in recent months.”
He further emphasized the importance of inter-agency cooperation, data sharing, and digital monitoring as part of the solution. Pakistan’s enforcement architecture must become smarter, faster, and more transparent. Tools like risk profiling and automated scanning must be institutionalized, not piloted. This is a national priority.”
While the government has initiated commendable enforcement measures, ACT Alliance Pakistan calls for sustained vigilance with a firm but fair approach toward eliminating the illegal economy. Akram concluded:
“We respectfully urge the Government of Pakistan, the Federal Board of Revenue, the Ministry of Interior, and law enforcement authorities to continue their clampdown on illegal trade. Let us not lose momentum. Every rupee recovered is a step toward economic justice and national renewal.”
