Islamabad - Welcoming Federal Finance Minister Ishaq Dar’s budget speech to reduce tobacco consumption by raising taxes, tobacco control advocates said Friday that the minister has wrongly raised the taxes on those cigarettes whose consumption is low in the country. In his speech the minister had said, “Cigarette smoking is a health hazard and for discouraging people from smoking, rates of federal excise duty on cigarettes is proposed to be increased from 58pc to 63pc.“
In this regard, the finance bill lying with the Parliament has proposed excise tax of Rs3,030 per such 1,000 cigarettes whose price is more than Rs 3,350 per 1000 cigarettes.  On 1000 cigarettes whose price is less than Rs 3,350 Federal Excise Duty (FED) of Rs1,320 has been levied.
According to TheNetwork for Consumer Protection, a consumer rights group, definitely this will increase the overall price of cigarettes but at the same time, it will affect largely those cigarettes that are expensive hence smoked by a limited number of people. The most-smoked cigarettes either remain unaffected or have nominal tax raise as compared with the tax margin levied on expensive or less-smoked cigarettes.
Nadeem Iqbal, Executive Coordinator of TheNetwork, told the media that this will not lower the tobacco consumption necessary to discourage smokers to stay away from health hazard. “In fact, we have been observing over the years that the government increases tax on tobacco but it does not have any effect on sale of cigarettes which always remain on the higher side,” he said.
Around 60 billion sticks are consumed annually by Pakistanis costing the nation a huge amount of Rs65 billion,” lamented Nadeem. Instead, he proposed that Rs 3,030 FED per 1,000 cigarettes should be imposed on such cigarettes whose per 1,000 price is less than Rs 3,350.
This fact should also be kept in mind that this year the trend of raising the minimum slab of cigarette that results in bringing down many brands from higher tax category to lower continues where less tax is imposed. Referring to the recently released government survey Global Adult Tobacco Survey (GATS), Nadeem Iqbal said the survey showed that a smoker’s monthly average tobacco cost is Rs767 which is equal to 20-kg of wheat flour. In other words, an average tobacco consumer spends an amount on cigarettes that could have procured him half-month wheat flour for an average-sized family, said Nadeem Iqbal. Thus preventing people from smoking by raising taxes on commonly used inexpensive cigarettes, the government will not only raise their buying power, the measure will also serve to discourage youth from initiating smoking. Moreover, Nadeem Iqbal said, raise in taxes is an effective tobacco control measure, quite popular with people and according to GATS report, 74.8pc of adults have favoured increase in taxes on tobacco.