Experts advocate for higher duties, taxes on cigarettes for healthy Pakistan

In a bid to ensure a healthier Pakistan, health experts are calling on the government to impose increased duties and taxes on cigarettes.

Various health activists and civil society organizations are urging the government to raise cigarette taxes in the upcoming federal budget for 2023-2024.

Representing PANAH, Sanaullah Ghumman emphasized the need for regular imposition of taxes on cigarettes in line with recommendations from the World Health Organization (WHO).

In a statement released on Saturday, Malik Imran, Country Head of the Campaign for Tobacco-Free Kids (CTFK), highlighted the positive impact of the government’s decision to raise the Federal Excise Duty (FED) on cigarettes in February 2023.

This move resulted in an additional revenue of Rs 11.3 billion in the fiscal year 2022-23, representing a 9.7% increase compared to the previous year. Moreover, an extra 4.4 billion in Value Added Tax (VAT) revenue was generated during the same period, marking an 11.5% increase from the previous year.

This combined additional revenue of 15.7 billion, which accounts for 0.201% of the GDP, significantly bolsters Pakistan’s struggling economy, according to Imran.

Imran further pointed out that these figures demonstrate the economic benefits of increased taxation, contrary to claims by the tobacco industry that illicit trade would surge. He asserted that the tobacco industry manipulates people by exaggerating the scale of illicit trade to divert attention from underreporting.

Another expert highlighted the devastating impact of tobacco in Pakistan, with over 170,000 deaths attributed to tobacco use annually. This epidemic also places an economic burden of 615 billion on the country each year, equivalent to 1.6% of Pakistan’s GDP. The expert explained that higher prices would reduce production and consumption, ultimately alleviating the burden on healthcare costs.

Estimates indicate a 31.7% decline in the declared production of cigarettes in the fiscal year 2022-23 compared to the previous year. Drawing on this example and the recommendations of the World Health Organization, it is advised that Pakistan increase taxes at regular intervals to account for inflation and per capita income, thus safeguarding its population from the harms of tobacco products.

In a statement, Khalil Ahmed Dogar, Programme Manager of SPARC, expressed concern over the tobacco industry’s targeting of children in order to recruit “replacement smokers.” Shockingly, approximately 1,200 Pakistani children between the ages of 6 and 15 start smoking every day.

Dogar emphasized that, on average, Pakistani smokers spend 10% of their monthly income on cigarettes. Consequently, raising prices remains the most effective strategy for curbing access to these harmful products among children.

Khalil stressed the need for all stakeholders to set aside their differences and unite in protecting children and youth from the dangers of tobacco.