In the midst of Pakistan's deeply troubled economy, marked by plummeting reserves, a precarious balance of payments situation, and high inflation, experts and anti-tobacco activists have stepped forward with a strategic recommendation of increasing tobacco taxation to bolster the economy.
The Society for the Protection of Rights of the Child (SPARC) warmly welcomed the appointment of Muhammad Aurangzeb as the country’s new minister and urged him to consider tobacco taxation as a potential avenue for bolstering the economy.
Such a measure could potentially offer a dual benefit of mitigating economic woes while simultaneously advancing the nation's health agenda, the SPARC said in a statement.
SPARC shared the concerns of health activists who advocate for higher taxes on cigarettes rather than utilities. This strategic approach not only aligns with public health goals but also addresses the broader economic implications associated with tobacco use, it added.
“Pakistan can generate additional Rs 17 billion in revenue through a 26 percent increase in taxes on cigarette,” said Rabia Syed, Director, IBC.
“This proposal not only aims to address immediate fiscal pressures but also aligns with broader public health objectives by discouraging tobacco consumption as outlined by the WHO” she added.
She said that Pakistan was one of the top tobacco-consuming countries, standing at the 7th position globally and 1st in the WHO Eastern Mediterranean Region (EMR) in terms of the number of tobacco product users.
According to an estimate the country produces more than 60 billion sticks of cigarettes every year, but when it comes to revenue, the Federal Board of Revenue (FBR) data shows all tax collection targets were missing during last seven years.
Malik Imran Ahmad, country head for Campaign for Tobacco-Free Kids (CTFK), appealed to the newly appointed Finance Minister, Muhammad Aurangzeb, to recognize the significant challenge posed by tobacco consumption in Pakistan.
He said with approximately 31.9 million adults consuming tobacco, accounting for 19.7% of the adult population, the impact on public health and the economy cannot be overstated.
Ahmad emphasized the burden placed on healthcare resources to treat smoking-induced non-communicable diseases, underscoring the urgent need for measures such as increased tobacco taxation to mitigate the economic strain and protect public health.
Dr. Khalil Ahmad, program manager at SPARC, highlighted the affordability of cigarettes as a driving factor behind youth initiation into smoking, further emphasizing the economic costs associated with smoking-related illnesses and deaths.
