PESHAWAR: Members of the Khyber Pakhtunkhwa Assembly on Monday demanded of the provincial government to impose tax on the transportation of the locally-produced tobacco to tax-free zones in other parts of the country for cigarette manufacturing.

During a session chaired by Speaker Babar Saleem Swati here, the lawmakers complained that Khyber Pakhtunkhwa produced most of the country’s tobacco but had just one or two factories to make cigarettes.

The issue was raised by treasury lawmaker Abdul Karim Khan through a calling attention notice.

He said Khyber Pakhtunkhwa produced 98 per cent of the total flue-cured Virginia tobacco in the country but it as well as its farmers didn’t get due benefit as the companies purchasing tobacco had set up cigarette manufacturing factories in other parts of the country, including Punjab and Azad Jammu and Kashmir.

Regret KP has one or two cigarette manufacturing factories

Mr Abdul Karim said that the factories established in tax-free zones didn’t benefit the residents of KP.

“On one hand, unemployment is rising in our province and on the other, we’re facing economic exploitation,” he said.

The lawmaker said due to the province’s poor economic condition, its youth were turning to terrorism and drugs.

“There is a need to impose tax on tobacco taken from here to other provinces for cigarette manufacturing,” he said.

Highlighting the issues of growers, he said under the law, the tobacco price couldn’t fall below the price fixed last year, but this year, tobacco was sold at rates lower than the previous year’s, causing farmers significant losses.

“In the current year, cigarette companies have earned Rs6 billion profit and the growers suffered the same amount of losses,” he said.

Member of the opposition PPP Ahmad Karim Kundi said that the farmers were worried about their issues and had pinned high hopes in the government for their effective resolution.

He said that the issue should be raised on all forums, while discussion should also be held in the house.

Mr Kundi said that it was a very sensitive issue as the province was producing tobacco with little profit for its own growers.

Responding to the queries of lawmakers, excise and taxation minister Syed Fakhr-i-Jahan said his colleagues had rightly raised the issue as only one or two cigarette manufacturing factories were functioning in KP though most Virginia tobacco in the country was produced in the province.

He added that in that manner, KP was getting only development cess on tobacco, while the respective federal excise duty was paid to those areas where the factories were established.

Speaker Swati said it was stressed that 99 per cent of the country’s tobacco was produced by KP, while factories for cigarette manufacturing operating in other parts of the country didn’t benefit the local people.

He ordered the formation of a special committee of the house to discuss the “multi-dimensional” issue, saying the committee will be notified by tomorrow.

Through a calling attention notice, the lawmakers criticised the provincial government for not completing the Regi Town project even 35 years years after its launch.

The issue was raised by member of the opposition PML-N Sobia Shahid, who said the project was launched in 1991 and even those allotted plots made all due payments in 1994 but the government had failed to give them the right to construct houses in several sectors of the township.

The speaker later adjourned the session until Tuesday afternoon due to lack of quorum.

Published in Dawn, April 14th, 2026