Levy on cigarettes in next budget, says Dr Sultan

The government is all set to implement a health levy on cigarettes from the coming fiscal year to discourage smoking, boost revenues and reduce the number of non-communicable diseases caused by the use of tobacco like cancer, diabetes and stroke.

Special Assistant to Prime Minister on Public Health, Dr Faisal Sultan, said that his ministry was working to incorporate the health levy bill on cigarettes into the upcoming Finance Bill to implement it across the country.

He said the health levy on cigarettes should have been implemented from the previous fiscal year after the federal cabinet approved the health levy in June 2019, but this could not happen owing to a number of reasons and administrative shortcomings. The federal cabinet approval is yet to be implemented.

"This delay in implementation of the health levy is causing a loss of around Rs38 billion annually to the national exchequer because of the lower tax collection."

The special assistant has vowed not to accept pressure from any influential industry to further delay the imposition of the levy, adding that the levy would help collect additional billions of rupees in taxes that would go a long way towards improving the health infrastructure of the country.

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In a letter written to the finance ministry, Dr Sultan emphasised upon the need to charge Rs10 per pack of 20 cigarettes as a health tax on tobacco and one rupee per 250ml on carbonated drinks as approved by the federal cabinet decision in a meeting held on June 18, 2019.

He said non-communicable diseases like heart disease, stroke, cancer, diabetes and chronic lung disease were collectively responsible for almost 68 per cent of all deaths in Pakistan.

Dr Sultan added that Pakistan is obligated to reduce one-third premature mortality from these diseases which is mainly caused by use of tobacco by 2030 as part of its targets set in Sustainable Development Goals (SDGs), he said.

He said the government could achieve the goal by resorting to stringent measures to reduce tobacco consumption among the people especially youth through imposition of the health tax. Officials in the Ministry of National Health Services said that they have yet to hear from the Finance Ministry on the Health Levy Bill.

The imposition of health tax on tobacco and sugary drinks as per the federal cabinet decision will act as a catalyst to reduce these non-communicable diseases in the country, he said in the letter.

The letter went on to state that this measure would also help boost revenues generated from tobacco.

Published in The Express Tribune, May 13^th, 2021.