LAHORE – Health activists have urged the government to remain steadfast on its decision to double the Federal Excise Duty (FED) on cigarettes.
In a press release shared by the Society for the Protection of the Rights of the Child (SPARC), health activists shared that this decision can solve Pakistan’s financial dejection, provided that the government is not misled by the tobacco industry’s misinformation campaign.
Malik Imran, country head, of Campaign for tobacco-free kids (CTFK), mentioned that tobacco-induced disease causes an annual economic burden of 615 billion, which is 1.6% of Pakistan’s GDP. Although the tobacco industry is one of the major taxpayers the revenue generated from the tobacco industry is 120 billion.
Therefore, the industry can’t claim that it is fulfilling its duty. The majority of the smuggled products belong to international companies operating in Pakistan. An industry that is causing such severe damage to people’s health and finances, should not use a victim card that is being ‘burdened’ by taxes. Therefore, instead of listening to the misinformation spread by the tobacco industry, everyone must appreciate the government’s decision which is in the interest of Pakistan’s health and economy.
And the government must be consistent about the decision it took on tax increases regarding tobacco products because existing tobacco taxes can generate an additional $60 billion in revenue.
Imran also mentioned that in order to gain sympathy tobacco industry uses emotional tactics e.g., providing for poor families, etc. The reality is that the deadly products of the tobacco industry are snatching away people’s precious resources. He mentioned that Pakistani smokers spend 10% of their monthly income on cigarettes on average. Therefore, this increase will make cigarettes go out of reach of low-income citizens and children, thus saving them from its harm.
Khalil Ahmed Dogar, Program Manager (SPARC) said that illicit trade is a harsh reality but its percentage is far less than the figure claimed by the industry. This is a cover used by the tobacco industry to divert people from underreporting. These companies underreport their production and then sell their non-reported products in the illicit market, causing a loss in billions of rupees to the national exchequer. Furthermore, illicit trade is not an excuse because the industry is making deadly non-essential products.
Consequently, it should have no qualms about paying taxes. Two wrongs don’t make a right. Yes, the government needs to counter illicit trade but it also needs to increase the taxes on tobacco companies.
Khalil mentioned that increasing the FED in February was a good step that shouldn’t remain a one-time activity. Keeping the World Health Organization’s recommendation in consideration, Pakistan should increase taxes at regular intervals so that inflation and per capita income are accounted for and Pakistanis remain protected from the harms of tobacco products.
