ISLAMABAD: Health activists and civil society organisations have demanded of the government to further increase taxes on cigarettes in the upcoming budget 2023-24.
Sanaullah Ghumman, representing PANAH pleaded that the government has to impose taxes on cigarettes on a regular basis as per recommendations of the World Health Organisation (WHO).
In a statement on Saturday, Malik Imran, Country Head, Campaign for Tobacco-Free Kids (CTFK) said that due to government’s decision of increasing Federal Excise Duty (FED) on cigarettes in February 2023, Rs 11.3 billion additional FED revenue was obtained in fiscal year 2022-23 which is an increase of 9.7% from the previous year.
Furthermore, an additional 4.4 billion VAT revenue was obtained in fiscal year 2022-23 which is an increase of 11.5% from the previous year. This additional 15.7 billion revenue makes up 0.201% of GDP which is a significant boost for a struggling economy like Pakistan, he said.
Imran mentioned that these self-explanatory figures revealed that increased taxation is beneficial for economy but the tobacco industry misleads everyone by giving the illicit trade excuse. Imran added that the exaggerated figure of illicit trade is used to divert people from underreporting.
Dr Ziauddin Islam, a retired government employee, said that tobacco is the largest silent killer in Pakistan as above 170,000 people die due to tobacco use each year. This pandemic also causes an annual economic burden of 615 billion which is 1.6% of Pakistan’s GDP.
He explained that increased prices bring a decrease to production and consumption which decrease the health cost burden. According to the estimates, there has been 31.7% decline in declared production of cigarettes in fiscal year 2022-23 compared to the previous year.
Learning from this example, which is also recommended by the World Health Organisation, Pakistan should increase taxes on regular intervals so that inflation and per capita income is accounted for and Pakistanis remain protected from harms of tobacco products.
According to the statement of Khalil Ahmed Dogar, Programme Manager SPARC said that the children of Pakistan are being targeted by the tobacco industry so that “replacement smokers” could be recruited.
Around 1,200 Pakistani children between ages of 6-15 years start smoking every day. He mentioned that on average Pakistani smokers spend 10% of their monthly income on cigarettes.
Therefore increased prices remain the most effective tool in keeping these killer products away from spending power of children.
Khalil added that all stakeholders must cast their differences aside and unite to protect our children and youth from the harms of tobacco.
Copyright Business Recorder, 2023
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