HEALTH levy is a tax imposed on non-essential products that pose a significant health harm such as tobacco and sugary drinks. This tax is to generate revenue to mitigate the health burden caused by these products. In first ever budget 2019 – 2020 of the present government, the cabinet approved a health levy of Rs 10 on cigarette packs and Rs. 1 on 25ml of sugary drinks that would have generated about Rs. 55 billion for the national exchequer. However, much to the dismay of public health activists the bill was withheld by FBR from being tabled in Parliament. Tobacco use is a major contributor to non-transmissible diseases such as lung cancer and heart disease. Additionally, tobacco use generates considerable economic loss, including increased spending on health-care.
Smoking has been advertised repeatedly as a trend among youth through mainstream media for the past few decades. According to WHO lead Global Youth Tobacco Survey in Pakistan 1200 children between the age of 6 and 12 become active tobacco users. The effects of smoking on children are indisputable. On the other hand, second-hand smoke causes numerous health problems in infants and children, including more frequent and severe asthma attacks, respiratory infection, ear infection and sudden infant death syndrome. Tobacco use also disproportionately impacts lower-income groups more as they already have limited access to healthcare facilities.
Studying Tobacco Users of Pakistan (STOP) survey was conducted in 10 most populous cities of Pakistan. The STOP survey  was approved by the Pakistan Health Research Council and executed in collaboration with Tobacco Control Cell of the Ministry of National Health Services, Regulations and Coordination. According to the survey, on average in Pakistan smokers spend 10% of their average monthly income on cigarettes. Raising taxes on tobacco is the most cost-effective solution for reducing tobacco use in all types of settings. The experience of the Philippines and other countries, including Egypt, France and Turkey, shows that raising tobacco taxes is feasible and has real benefits for the health sector and beyond.
According to WHO report ‘Raising Taxes on Tobacco’ published in 2014, if all countries increase taxes on cigarette packs by 50%, there would be 49 million fewer smokers and 11 million fewer deaths. In addition to reducing tobacco use and the associated health burden, tax increases generate substantial additional revenue to governments. Tax increases are a win-win situation because they are good for both public health and government revenue. Government revenue raised in this way can be used for health and other public benefit.
In Pakistan, tobacco use cost the economy PKR 192 billion due to health care costs for tobacco-related diseases and lost productivity (PHRC). In comparison, the revenue generated from tobacco taxation is only PKR 115 billion. Given the health care cost it makes it all the more necessary to implement health levy on tobacco products to generate Rs. 55 billion to mitigate the cost of tobacco consumption. Currently the country is only a step away from generating this revenue. The bill needs to be moved to Parliament by the Ministry of Finance. Despite approval from Ministry of Law the Federal Board of Revenue has deferred the implementation of the bill on technical grounds. Supreme Court lawyers have confirmed that the legal position is clear and can be implemented by the Federal Government.
Pakistan is losing about 166,000 lives every year to tobacco consumption and billions of rupees from national exchequers due to lack of policy actions. It remains unclear why government institutions continue favouring corporate interests at the cost of an average Pakistani citizen. It is highly required to pivot the policy narrative in favour of people and rescue several lives from the health harms of tobacco products.
—The writer is Programme Manager, Society for the Protection of Rights of the Child, SPARC, Islamabad.