Govt Urged to Increase Excise Duty on Tobacco Products in FY23 Budget

Renowned health experts want the government to increase the Federal Excise Duty (FED) on cigarettes and tobacco products in the upcoming budget as a bridge to much-needed funds.

They stated this in a Pre-Budget webinar on ‘the need to increase taxation on cigarettes’ that was hosted by the Social Protection Resource Center (SPRC) that was attended by policymakers, government officials (from the Ministries of Health, and Finance, and the Taxation and Law Divisions), public health experts, social workers, and academics.

The former Special Assistant to the Prime Minister (SAPM) on Health, Dr. Zafar Mirza, emphasized the established harmful effects of tobacco use and the effectiveness of higher tobacco taxation in the current and future political contexts. He said that it would be prudent to discuss raising the taxes on tobacco products during Pakistan’s discussion with the International Monetary Fund (IMF).

“Because we are in a fiscal problem, this will also overcome the political barriers this area faces,” Dr. Mirza reasoned.

Sociologist and Dean National Institute of Public Policy (NIPP), Dr. Safdar A. Sohail, highlighted Higher Taxation as an evidence-based strategy that was adopted by many regional countries and had favorable outcomes, especially in Low and Middle-Income Countries (LMICs). He furthered his argument with regional examples from several countries, including Sri Lanka, Bangladesh, China, the Philippines, and The Gambia.

Dr. Sohail reiterated Dr. Mirza’s comments and encouraged the experts to collaborate to make recommendations to move a policy to raise taxes on tobacco products.

Country Lead Campaign for Tobacco-Free Kids, Malik Imran, highlighted that there has been no ‘real change’ in the taxes on cigarettes over the last four years. He emphasized the industry’s efforts in diverting the focus from tobacco taxation to illicit trade for which the tobacco industry has spent Rs. 1.2 billion.

Imran also recommended focusing policy priorities on raising tobacco taxation.

The Director of the Law Division recommended making cigarettes progressively more expensive, with an automatic adjustment for inflation. He commented that uniform FED should be set for all cigarette brands and excise taxes should be levied on all tobacco products.

National Focal Person World Health Organization Framework Convention on Tobacco Control (WHO FCTC), Dr. Samra Mazhar, spoke about the efforts of the Ministry of National Health Service in protecting people from tobacco hazards. She clarified that the ministry is not the lead agency in the taxation policy but is a strong anti-tobacco advocate.

Dr. Marzhar also suggested the need to continue advocating for raising the FED on cigarettes to the Ministry of Finance, the Federal Board of Revenue (FBR), and the parliamentarians.

Vice-Chancellor Health Services Academy, Dr. Shahzad Ali Khan, concluded the session by emphasizing the use of anti-tobacco campaigns aimed at the youth. He suggested the formation of an anti-tobacco advocacy group with politicians, parliamentarians, and subject and health experts to gain momentum for this important movement because approximately 170,000 people die from tobacco use every year in Pakistan.

He added that the health burden caused by tobacco use in the country amounts to Rs. 615 billion while the revenue generated from its product is only Rs. 120 billion through taxes.

Faiz Paracha is a seasoned broadcast journalist with over 15 years’ experience in reporting and e...