Bangladesh Tobacco Tax Proposal 2021-22

The most effective way to reduce tobacco use is to raise the prices of tobacco products through tax increases that lower their affordability. Higher prices discourage youth from initiating tobacco use and encourage current users to quit.

If the Government of Bangladesh reforms the current tobacco tax system following the recommendations for FY 2021-2022 proposed in Table 1 to 3 below, it would:

• Encourage nearly4 million adults to abstain from smoking and stop more than 74 thousand youth from starting to smoke;
• Reduce the prevalence of cigarette smoking from 15.1% to 13.9%;
• Save the lives of more than 480,000 current adults and 37,000 current youth from premature deaths in the long term;
• Generate nearly BDT 34 billion in additional tax revenues from Supplementary Duty, Health Development Surcharge and VAT on top of the collection for FY 2020-2021, that is an increase by 12% of current tax revenue from cigarettes in the first year.

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