Illicit cigarettes trade causes loss of Rs. 80bn

ISLAMABAD: The country has lost Rs. 80 billion in last five years due to illicit trade in cigarettes and is expected to lose another Rs. 100 billion in the next five years.

According to Euromonitor International, a global research agency, Pakistan, the penalties for the sale of smuggled cigarettes included confiscation of such cigarettes, fine up to Rs. 50,000, recovery equal to 500% of unpaid taxes and the imprisonment up to five years.

However up till now the markets are flooded with smuggled cigarette brands, especially in the absence of enforcement.

Under the laws, the mandatory pictorial and textual health warning in Urdu and English as well as printing of underage sale warning and retail price on each pack is mandatory for cigarettes packs to be sold in Pakistan.

Smuggled cigarettes, however do not comply with any of these mandatory requirements. In addition to that due to non-payment of duties and taxes, the national exchequer suffers huge losses.

In this situation, citizens praised the proposal of the government to increase taxes on tobacco as specified in the finance bill in order to discourage its consumption in public particularly in youth.

It is pertinent to mention here that World Health Organization (WHO) has called for increasing the price of tobacco to reduce its use by discouraging potential users and helping to prevent relapse in those who have quit smoking.

According to WHO, higher taxes on tobacco raise more revenue for governments and health programmes, which reduce tobacco use and lead to healthier communities and healthier economies.

Under the WHO Framework Convention on Tobacco Control, countries should implement tax and price policies on tobacco products as a way to reduce tobacco consumption.

Tobacco use is one of the four main risk factors that increase the risk of or cause most noncommunicable diseases, along with physical inactivity, and unhealthy diet.

Tobacco accounts for almost 6 million deaths every year including over 600 000 deaths from exposure to second-hand smoke, and is projected to increase to 8 million by 2030.