Karachi, January 2, 2025 – In the midst of unprecedented economic challenges, Pakistanis spent a staggering Rs 276 billion on cigarettes during the first nine months of 2024. This shocking revelation emerges as the nation grapples with soaring inflation and dwindling resources for essential commodities.
Financial reports from two major companies, Pakistan Tobacco Company (PTC) and Philip Morris International (PMI) Pakistan, highlight this extravagant expenditure. PMI reported sales of Rs 20.49 billion for the nine-month period ending September 30, 2024, while PTC accounted for a monumental Rs 255.54 billion in sales over the same timeframe. Both entities, listed on the Pakistan Stock Exchange (PSX), contribute significantly to the national exchequer through duties and taxes, while providing employment across the supply chain.
The annual quantum of sales is expected to be much higher. If we calculate the non-duty-paid cigarettes and smuggled segments, the actual number of cigarettes consumed could potentially double.
However, the crux of the matter lies not in the revenue generated but in the enormous health and economic costs borne by the citizens. Despite warnings from health and social organizations about the dire consequences of smoking, the government remains focused on revenue generation rather than public welfare.
Even if these companies contribute approximately half of their sales revenue in taxes, the financial and health benefits of banning cigarettes far outweigh the loss of excise duties. Cigarettes, deemed non-essential, primarily contribute to federal excise duty, a tax category intended for luxury or harmful items. Eliminating cigarettes would not significantly affect national revenue but would safeguard public health and redirect resources towards constructive economic activities.
A complete ban on cigarettes could keep the Rs 276 billion in the hands of citizens, enabling them to invest in improving their quality of life. This redirected spending could stimulate other manufacturing sectors, create jobs, and bolster the overall economy. By prioritizing human development over excise revenue, the government could foster a healthier, more prosperous society.
Pakistan, as a developing nation, cannot afford such colossal wastage of resources. The expenditure on cigarettes underscores a deeper economic mismanagement, where short-term revenue considerations overshadow long-term societal gains. The government must urgently rethink its policies and prioritize the welfare of its citizens over the profits of tobacco companies. A decisive move towards banning cigarettes would not only save lives but also channel billions of rupees into more productive avenues, paving the way for a healthier and more sustainable future.
