Executive Director SPARC, Sajjad Ahmed Cheema said that it is estimated if the government eliminates the lowest tax tier and brings the FED of the lower tier to Rs 40, it would raise significant additional tobacco tax revenue of Rs 18.4 billion - 20.9 percent increase from current tobacco tax revenue. "This will reduce cigarette consumption by 12.6 percent and reduce the number of smoking-related deaths among current and future smokers by 3.1 percent (a reduction of about 0.35 million people every year)," he said.
"We are still unable to know why this sector is being ignored for an imposition of tax, which has been contributing a lot to increase the health cost and burden of diseases on our nation," he said, adding that this has made cigarettes and other tobacco products within the reach of the children buying power.
"We urge the government to increase tobacco taxes and save our children," he said. Malik Imran Ahmad from Campaign for Tobacco Free Kids said that tobacco industry caused a whopping Rs 153 billion loss to the national exchequer between 2016 and 2019, by being awarded low tax rate and adjusting the prices of their most sold brands.
He said that almost 90 percent of all brands consumed in Pakistan were taxed as "low" tiers under the previous tax system (FY 2016-17). If their prices had remained the same, most would have automatically been reclassified as "medium" (89% of them).
Talking about the third tier, he said around 160 billion cigarettes were produced between May 2017 and March 2019. Big tobacco companies share 75 percent of the total market, which means they were able to sell 120 billion cigarettes in the same period. Loss of revenue due to introduction of 3rd tier (low tobacco taxes) is Rs 77.85 billion from 2016 to 2019. Loss of revenue due to price adjustments is Rs 75 billion from 2018 to 2019, he said.
Manager Research SPARC Khalil Ahmad shared that Pakistan is one of the fifteen countries worldwide with the heavy burden of tobacco-related ill-health issues. Around 1,000 to 1,200 Pakistani children between ages of 6 and 15 years start smoking every day according to the Global Adult Tobacco Survey (GATS) results of 2015, he added.