ISLAMABAD – The Social Policy Development Centre (SPDC) has proposed a 37% increase in the Federal Excise Duty (FED) on tobacco products in Pakistan. Their policy paper, “Recovering Healthcare Costs and Saving Lives,” estimates that this increase could save 265,000 lives, generate an additional revenue of Rs 37.7 billion, and encourage 757,000 people to quit smoking.
The paper highlights how cigarette companies have been lobbying against tax hikes, resulting in Pakistan losing Rs 567 billion in revenue over the past seven years. Although Pakistan has made progress in increasing tobacco taxes, it still falls short of fully implementing World Health Organization (WHO) recommendations to save lives and curb tobacco use.
The WHO has recommended that tobacco excise taxes be at least 70 per cent of the retail price. Currently, there is a two-tiered FED system on cigarettes. Following the proposed increases during 2022-23, the current FED share in retail prices will be 48 per cent and 68 per cent for low and high tiers, respectively.
While Pakistan has made progress in enforcing tobacco control measures, tobacco industry interference has weakened policies. The Global Tobacco Industry Interference Index 2023 ranked Pakistan at 32nd, noting that tobacco taxes as a percentage of the retail price stood at 61 per cent, while the global standard is 70 per cent.
“We urge the government to align its policies with WHO recommendations and save lives,” said Malik Imran Ahmed, Country Head of the Campaign for Tobacco-Free Kids (CTFK). “Pakistan direly needs robust implementation of WHO recommendations,” said Maryam Gul, Director of the Center for Research and Dialogue (CRD).
Pakistan has a high prevalence of smoking, with 31.6 million adults (nearly 20% of the adult population) using tobacco products.
