Budget 2025-26: After sugar, FBR sets its sights on tobacco sector

Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial on Wednesday detailed a sweeping overhaul of the country’s tax compliance system, vowing to crack down on non-compliant sectors, expand digital monitoring, and address longstanding loopholes in the tobacco, retail and passive income tax regimes. Speaking to Geo News, Mr Lan­g­rial said that the government’s re­­cent enforcement drive in the sugar sector had resulted in a 39 per cent increase in tax collection without any change in tax rates, and that si­­milar measures are now being rol­led out across other key industries. “The story of non-compliance in the tobacco sector will fundamentally change, just as it did in sugar,” he said. He acknowledged that raising tax rates on the formal sector often led to market erosion by the informal sector, but said the government’s solution is to target non-compliant businesses directly.