Islamabad, November 16, 2024 – Experts at a seminar titled “Taxing Tobacco: A Path to Reducing Consumption and Saving Lives” highlighted the pressing need for a comprehensive and sustainable tobacco taxation policy in Pakistan.
Organized by the Sustainable Development Policy Institute (SDPI), the seminar brought together policymakers, public health experts, and civil society representatives to underscore the transformative potential of taxation as a public health and economic tool, according to a press release issued on Saturday.
Tobacco Taxation: A Critical Public Health Imperative
Speakers at the seminar stressed that Pakistan’s existing two-tiered tobacco taxation system inadvertently enables the tobacco industry to circumvent public health objectives. Industry practices, such as preemptively raising prices ahead of budget announcements, were identified as mechanisms to dilute the impact of tax increases. Moreover, the absence of taxes on smokeless tobacco products like Naswar and the minimal regulation of nicotine pouches create significant loopholes, allowing the industry to exploit alternative markets and sustain consumption.
Experts advocated for a unified, long-term taxation framework encompassing all tobacco products. Such a policy would reduce affordability, address health disparities, and align with global best practices, particularly the World Health Organization’s (WHO) Framework Convention on Tobacco Control (FCTC) and MPOWER framework.
Recommendations and Strategies for Reform
Participants called for adopting health-specific taxes to fund public health initiatives and emphasized combating illicit cross-border trade through regional collaboration. Expanding the track-and-trace system to include exports and smokeless tobacco products was highlighted as a crucial step toward enforcement.
Notably, the seminar reiterated the WHO’s guideline of ensuring a minimum 70% tax share in the retail price of tobacco products—a target that Pakistan has yet to achieve. Regular tax adjustments to account for inflation were deemed essential to maintaining affordability controls.
Expert Insights
• Syed Wasif Ali Naqvi, Senior Research Associate at SDPI, emphasized that tobacco taxation is a proven strategy for reducing consumption while generating significant government revenue. He criticized the absence of long-term policies, noting that industry interference remains a persistent barrier.
• Dr. Waseem Iftikhar Janjua called for progressive taxation to reduce the affordability of tobacco products, particularly loose cigarettes, a common entry point for youth smokers. He underscored the necessity of regulating nicotine pouches and smokeless tobacco products to curb their growing market presence.
• Asif Iqbal highlighted the importance of a stable 3–5-year taxation framework, pointing out that the widening tax gap between economy-tier and premium-tier brands undermines equity. He advocated for gradual tax increases on economy-tier products and targeted measures to combat illicit trade.
• Khurram Hashmi, Senior Technical Lead at Vital Strategies, focused on countering industry narratives. He highlighted the economic and health benefits of stringent taxation policies and called for unified advocacy among anti-tobacco stakeholders during budget deliberations.
A Call to Action
The seminar concluded with a collective call for evidence-based taxation reforms aimed at reducing tobacco consumption and prioritizing public health over industry profits. Pakistan’s current taxation framework, heavily influenced by political considerations, requires strategic realignment to achieve sustainable health and economic outcomes.
By consolidating recommendations from civil society and public health advocates, the event aimed to build momentum for robust anti-tobacco measures in the upcoming budget, addressing the tobacco industry’s pervasive influence and advancing the nation’s public health agenda.
