ISLAMABAD: Health activists in Pakistan have demanded a higher hike in tobacco taxes to safeguard the well-being of children and the general public.
The Society for the Protection of the Rights of the Child (SPARC), in a statement, made this call at a time when the nation faces a severe public health crisis.
Malik Imran Ahmed, Country head of the Campaign for Tobacco-Free Kids (CTFK), highlighted concerning statistics on tobacco use in Pakistan. With approximately 31.6 million adults, or about 19.9% of the adult population, currently using tobacco, the resulting illnesses claim over 160,000 lives annually, burdening the healthcare system and costing the economy at least 1.4% of its GDP each year.
Ahmed noted the promising outcomes of recent Federal Excise Duty (FED) reforms on tobacco, with collections surpassing PKR 122 billion from July 2023 to January 2024, and projections for the full year exceeding PKR 200 billion. This indicates a substantial increase compared to previous fiscal years.
Moreover, the reforms are anticipated to generate an extra PKR 60 billion in General Sales Tax (GST) from cigarettes for the fiscal year 2023-24, with a combined impact of around PKR 88 billion, signifying a remarkable relative growth of nearly 49% compared to the prior year.
Ahmed stressed the importance of these reforms in promoting public health by reducing tobacco consumption and potentially recovering 17.8% of the total healthcare costs associated with smoking in Pakistan. However, maintaining the current rate could result in decreased health cost recovery, necessitating immediate action.
To achieve similar levels of health cost recovery observed in 2023-24, a 37% increase in the FED rate for the upcoming year is recommended. This tax proposal is viewed as a ‘win-win’ scenario, benefiting both the government and the people of Pakistan by enhancing revenue and safeguarding public health.
Dr. Khalil Ahmad Dogar, Program Manager at SPARC, echoed these concerns, emphasizing the dire impact of tobacco use on families, communities, and the economy. He underscored the urgent need for effective measures to address the crisis, refuting misconceptions about tax increases promoting illicit trade.
Dr. Khalil highlighted the manipulative tactics of tobacco firms in influencing tax policies and evading taxes, while also mentioning the expected benefits of the recently initiated track & trace system in combating counterfeiting and regulating the tobacco industry.
Urging decisive action to curb tobacco use in Pakistan, particularly among children, Dr. Khalil emphasized the imperative of safeguarding citizens’ health and well-being.
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