The government is expected to keep the Federal Excise Duty (Federal Excise Duty) on cigarettes and tobacco products unchanged in the upcoming budget, despite earlier discussions about raising rates to boost revenue.

Policy deliberations had included proposals to increase excise charges and possibly remove the existing two-tier taxation system in the tobacco sector. However, current indications suggest that authorities are likely to maintain the existing structure.

Officials and analysts warn that any sharp increase in tobacco taxation could unintentionally strengthen the illicit cigarette market, reducing the tax base instead of expanding it.

Given these concerns, no significant change in tobacco excise duties is anticipated in the next fiscal plan, with the government appearing to prioritize stability in the sector over aggressive tax adjustments.