Govt increases FED and implement surcharge on tobacco products, HDF


ISLAMABAD:   (Parliament Times)  In an online media session, Mr. Azhar Saleem, CEO Human Development Foundation (HDF) appreciated the steps taken by government for tobacco control. In the current pre-budget time period, the government did not succumb to the pressure from tobacco industry and retained the two tier structure for tobacco taxation. He appreciated that the government stayed true to its commitment of keeping public health a priority.
Senator Muhammad Ali Khan Saif and Senator Kulsoom Parveen submitted their recommendations to the Senate urging the government to increase FED and implement a surcharge on tobacco products. They proposed the recommendations on Finance Bill 2020. In these recommendations, they have asked the government to increase FED on the top tier up to Rs. 30 which captures 10% of the market share with less competition. The lower tier comprises of 90% of the market share. The recommendations also suggest an increase in the prices of lower tier cigarettes which currently stands at Rs. 80. It was suggested to increase the prices of lower tier cigarettes up to Rs. 100 by adding a Rs. 10 duty/pack of cigarettes.
Quoting the study “Economic Burden of Smoking Related Illnesses in Pakistan” conducted in 2018, Mr. Malik Imran, country representative of Campaign for Tobacco Free Kids (CTFK), stated that the current economic cost of tobacco consumption is Rs. 192 billion. Approximately, 166,000 deaths occur in a year due to tobacco use. According to a research, poor families spend at least 3.9%of their household income on cigarette purchasing. Tobacco consumption not only perpetuates poverty, it increases the health burden and associated cost for both the government and its people.
Mr. Azhar Saleem stated that by increasing FED on tobacco products, more revenues will be generated by FBR and help in reducing the health cost of tobacco consumption. The increased FED and surcharge on tobacco products will open new financial avenues to sustain tobacco control programs in Pakistan.