Tracking the Track-and-Trace: two waves of cigarette pack surveys on tax administration in Pakistan

Abstract

Introduction: Pakistan implemented the Track and Trace System (TTS) to administer cigarette tax in July 2022. We assessed its implementation by examining the presence and validity of tax stamps (evidence of tax collection) on cigarette packs and how these varied by manufacturer and over time. Methods: We collected cigarette packs from points-of-sale (POS) in two waves: August 2023 (POS=648) and October 2024 (POS=718). POS were located within a stratified random sample of 72 enumeration blocks (EBs) within purposively selected nine districts of Pakistan. Within each EB, we collected one cigarette pack per brand variant. These were examined for the presence and validity of digital tax stamps using the TransAct mobile app. Results: We collected 1617 and 2278 cigarette packs in waves I and II, respectively. The presence of tax stamps was higher on the cigarette packs manufactured by the local subsidiary of British American Tobacco, Pakistan Tobacco Company (PTC) (2023: 89.9% (295/328) and 2024: 97.7% (428/438)) and Philip Morris International (PMI) (2023: 79.0% (207/262) and 2024: 83.7% (302/361)) than those manufactured by local companies (2023: 1.9% (17/893) and 2024: 3.9% (56/1440)). Between 2023 and 2024, the proportion of packs bearing valid tax stamps increased from 53.2% (157/295) to 77.6% (332/428) (p<0.001) for PTC and from 56.0% (116/207) to 79.1% (239/302) (p<0.001) for PMI; for local manufacturers, the increase from 52.9% (9/17) to 80.4% (45/56) was non-significant (p=0.10). Conclusion: Within 2 years of TTS implementation, cigarette tax administration improved significantly for the two leading multinational manufacturers, but not for local manufacturers.