ISLAMABAD: While different divisions are finalising budget proposals with a goal to decrease expenses and generate maximum revenue, health activists have submitted a draft to the health ministry suggesting that if implemented it can generate Rs65 billion for the exchequer.

The draft has been handed over to the prime minister’s coordinator on National Health Services Dr Malik Mukhtar Ahmed Bharath suggesting a 26.6 per cent increase in the Federal Excise Duty (FED) on tobacco products.

This was stated by legal expert Malik Imran at a media briefing organised by the Human Development Foundation (HDF) on Monday.

He highlighted the economic toll of tobacco consumption, citing an annual loss of Rs615 billion. Referring to a World Bank report, he said that there was ample room to increase tax on tobacco products.

“The government can generate additional Rs65 billion from the industry by increasing the tax up to 26pc,” he stated.

He said the draft of proposal had been shared with Dr Bharath in which it had been stated that this approach has the potential to yield a “triple win” for Pakistan: a reduction in the number of smokers by 517,000, a 12.1pc increase in tax revenue for the government and a 19.8pc recovery of healthcare costs associated with tobacco use.”

Mr Imran said tobacco use was the leading cause of preventable deaths in Pakistan, claiming over 160,000 lives annually. He said the economic burden was equally significant with smoking-related illnesses and deaths costing Pakistan 1.4pc of its GDP each year.

HDF Programme Manager Zahid Shafiq said: “If the traditional forms weren’t enough, the tobacco industry has also flooded the market with novel products (nicotine pouches, e-cigarettes and heated tobacco devices) which are openly sold to youth through point-of-sales advertising and extensive social media campaigns. There is a need to ban all forms of novel products immediately before our youth becomes addicted to them.” He urged the government to consider a significant increase in tobacco taxes.

“The policy change will not only generate substantial revenue for the national economy and healthcare system but, more importantly, will also save countless lives,” he added.

Published in Dawn, April 30th, 2024