Business May 1, 2021 KARACHI: A three-tier system to collect federal excise duty on production and supply of tobacco products has been finalised for reintroduction through Finance Bill, 2021, sources said on Friday. Federal Board of Revenue (FBR) sources said the matter of massive duty evasion and prevalence of smuggled products had compelled the authorities to find a way to maximise documentation of manufactured products. They said the tax authorities and stakeholders were mulling re-introduction of a three-tier system. The issue was discussed in detail after capturing all relevant data of the tobacco industry. At present there are around 41 cigarette manufacturers in the country. However, two companies have 96 percent industry share in payment of duty and taxes. The FBR considered stakeholders’ budget proposals, which explained that existing higher duty and tax rates encouraged evasion and use of smuggled cigarettes.