Increased FED on tobacco can generate Rs 26 billion for the economy in need


ISLAMABAD: Pakistan’s economic situation is getting worse day by day. Our imports are increasing, and with them, the prices of essential commodities are now at high levels. In a tough situation like this, the new Shehbaz Sharif led government can give the economy a few billion by imposing Federal Excise Duty (FED) on tobacco products.

This was the crux of a discussion arranged by SPARC an organization working on saving youth from tobacco hazards.

Anti-Tobacco Activists suggested new govt. should increase FED on Tobacco Products by 30% to generate additional 26 billion that can be used for human development.

Mr. Khalil Ahmed Dogar, Program Manager, SPARC, shared that due to affordability and easy availability, the number of smokers has reached up to 29 million, including 1200 children who initiate smoking daily and 170,000 people die yearly due to tobacco consumption.

He further added that the use of tobacco causes an economic burden of 615 billion which is 1.6% of Pakistan’s GDP contrary to the revenue generated from the tobacco industry (120 billion in 2019) is approximately just 20 percent of smoking’s total cost. This situation calls for immediate implementation of the World Health Organization’s recommendation of a 30% increased tax on tobacco products. The increase in Tobacco Tax will generate revenue of approximately 26 billion.

Dr. Ziauddin Islam, Country lead of tobacco control Pakistan for Vital Strategies, said that Pakistan’s youth consists of 64% of the population, which is an easy target for the Tobacco Industry. The industry considers adolescents as replacement smokers. In Pakistan, cigarettes are available at some of the cheapest rates in the region which grants easy access to youth. The increased price of tobacco will make them unaffordable for youth because youngsters are more price sensitive.

Mr. Shariq Mahmood Khan, CEO of Chromatic Trust added that taxes are the most cost-effective tobacco control measure. He requested to the new govt. to increase tobacco taxes on tobacco products to reduce consumption and generate additional income.
Ch. Sanaullah Ghuman, General Secretary, Pakistan National Heart Association (PANAH), said that there is a high prevalence of smoking among youth. The new govt should strictly comply with the laws that ban the advertising, promotion, and sponsorship of all tobacco products; increases the size of warning labels required on cigarettes – a significant step to protect Pakistani youth.

For decades, tobacco companies have used strategies like youth-oriented marketing to lure young people into a lifetime of addiction. We must not allow our youth to face this fate, he added.