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Tuesday, May 21, 2024

Pakistan Tobacco Company (PTC)’s Asia and Middle East business hub to be set up in Pakistan

Pakistan Tobacco Company (PTC) a subsidiary of British American Tobacco Company will set-up its regional business procesing outsourcing hub in Pakistan

In a tweet, Adviser to Prime Minister of Pakistan for Commerce and Investment has announced Pakistan Tobacco Company (PTC), a subsidiary of British American Tobacco company’s decision to establish it’s business process outsourcing (BPO) hub in the Asia Pacific and the Middle East region in Pakistan.

The BPO definition, according to Techopedia, is “the contracting of non-primary business activities and functions to a third-party provider.”

“I am excited to share with you all that Pakistan Tobacco Company has announced its plan to set up a BPO organization hub in Pakistan to serve the Asia Pacific and the Middle East region,” Adviser to Prime Minister on Trade and Investment Abdul Razak Dawood informed said in a tweet earlier this week. 

Pakistan Tobacco Company’s BPO to provide 3000 new jobs

Dawood said that the upcoming BPO hub could create over 3,000 jobs over the next five years and serve as a talent incubator, besides enabling Pakistan to become a services export market and bring approximately $100 million foreign exchange earnings per annum.

Read more: Health advocates appalled as PM Khan meets Tobacco firm for dam fund

“I wish to thank British American Tobacco and PTC for placing confidence in Pakistan. After many years, this is the first multinational company to move their business process outsourcing to Pakistan,” he added.

He also said that the PTC competed with countries like India, Bangladesh & many others to bring this new business set up to Pakistan.

Black Market for cigarettes causes a huge loss to the country’s finances.

Last month, various news sources reported that the black market sale of cigarettes resulted in tax evasion of Rs77.3 billion in Pakistan during the fiscal year 2019-20.

Illicit cigarettes accounted for 37.6 percent of total consumption in Pakistan in March 2020 compared to 31.5 percent just from a year earlier. Sources within the industry claimed that several domestic companies evade taxes, adding that around 10 brands are smuggling through the Afghan transit trade.

Due to the high inflation rate in Pakistan, the consumers’ spending power has reduced. The consumption volume is expected to shift towards non-duty-paid cigarettes, which would harm the government revenue, sources said.

Read more: 10% of tax filers in Pakistan pay 45% of total tax: report

A PTC representative said that although the government intends to introduce a track-and-trace system, its success depends on board implementation and enforcement to check at a retail level.

The representative said that there is a need to reduce the minimum pack price to reduce non-taxed cigarettes. Federal Excise Duty (FED) on unmanufactured tobacco needs to be increased to Rs500 kg, he added.

Read more: PM Abbasi bans Loose cigarettes across Pakistan to discourage smoking

“Our estimate suggests that the share of illicit cigarettes stands in the range of 16 to 18 percent, causing Rs24 billion losses to our revenues,” Member Tax Policy FBR Chaudhry Muhammad Tarique said in a policy dialogue on tobacco taxation.

GVS News Desk