The Federal Board of Revenue (FBR) has projected an amount of Rs 61 billion as taxes from cigarette manufacturers after the upward revision in rates of excise duty on various brands of cigarettes during 2009-10. In 2007-08 revenue from different brands of cigarettes had resulted in total collection of Rs 45 billion in the form of sales tax and federal exercise duty.
This was stated by a senior official of the FBR while replying questions raised regarding the rates of excise duty on various brands of cigarettes in a the National Advocacy Conference on Tobacco Control, held here on Wednesday. Director General Health, Rashid Juma, Dr Khalif Bille, Country Representative World Health Organisation (WHO), Shaheen Masood, DG Implementation, FTCT, Dr Arif Azad, Executive Co-ordinator, The Network and health experts were present on the occasion.
The sales tax collection from cigarettes has improved from Rs 7.9 billion in 2007-08 to Rs 9.6 billion in 2008-09, showing 22.7 percent growth. This growth is achieved despite input adjustment has almost doubled in 2008-09. Moreover, production of cigarettes has increased by 12.1 percent during 2008-09. The major revenue spinners included petroleum products, telecom services, natural gas, sugar, cigarettes, services, electrical energy, beverages, cement and tea.
Currently 57 tobacco manufactures are operating in Pakistan. The two leading cigarette giants have contributed 52 percent and 46.9 percent of the tax paid market. Twenty percent of markets are captured by illicit trade ie non-tax paid sales, counterfeit and smuggling. Dr Bille said from February 2010 the pictorial display on the cigarette packs would be initiated.
Speaking on the occasion, the experts criticised the Ministry of Health for not properly implementing the anti-smoking laws. They said in majority of the educational institute cigarettes are being sold openly. They were of the view that use of the cigarette can only be overcome by strengthening the implementation law and by implementing the Clear Air Act.
Sharing the figures with the participants, the experts said tobacco use in Pakistan is common and one of the highest in South East Asian region. There are about 22 million smokers in the country and 55 percent of the household has at least are individual who use tobacco. About 100,000 persons annually die of diseases caused by tobacco in the country. Three hundred Pakistanis die every day from tobacco and 500 get admitted to hospitals.