If specific taxes are imposed, the revenue income will increase by tk 3340 crore -

Budget dialogue on tobacco prices and taxation

If specific taxes are imposed, the revenue income will increase by tk 3340 crore

According to the proposals of anti-tobacco organizations, by imposing specific tax on tobacco products the government will be able to generate additional revenue of tk 3,340 crore for the fiscal year 2021-22. Also, compared to inflation, the proposed price for tobacco products in the budget has decreased by 0.7 percent average compared to the current financial year, said Dr. Rumana Haque professor of Department of Economics, University of Dhaka and convener BNTTP. This information has come up in the research of anti-tobacco organizations. She made the remarks while delivering a keynote paper at a virtual Budget Dialogue on “Prices and Taxes on Tobacco Products and Its Impact on Public Health” on the online meeting software “Zoom” at 11:30 am on Saturday, June 12, 2021. The Budget Dialogue was jointly organized by the Bureau of Economic Research (BER), University of Dhaka; Bangladesh Network for Tobacco Tax Policy (BNTTP) and Tobacco Control and Research Cell (TCRC).

The event was chaired by Veteran politician and chairman of Natab Mozaffar Hossain Poltu and moderated by former chairman of the National Board of Revenue Prof. Md. Nasir Uddin Ahmed. As discussant Prof. Dr. Md. Habibe Millat, MP Sirajganj-2; Shirin Akhter, MP, Feni-1; Barrister Shamim Haider Patwari, MP Gaibandha-1; Syed Mahfuzul Haque, National Professional Officer, WHO and Advocate Syed Mahbubul Alam, Policy Analyst & Technical Advisor, The Union joined in the program.

In her speech, Professor. Rumana Haque further said, the potential revenue income of the government from the cigarette sector in the FY 2020-21 is tk 27,160 crore. If a specific tax is imposed for the FY 2021-22 as proposed by the anti-tobacco organization, the amount will increase to tk 30,520 crore. In contrast, the budget proposed by the government will generate revenue of tk 27,960 crore. So, the government will lose tk 3,340 crore in revenue if it does not accept the specific tax proposal. We have always demanded an increase in the price of tobacco products but the average price of cigarettes has come down by 0.7% in terms of inflation due to the unchanged prices of low and middle tier cigarettes and a slight increase in the price of high and premium tier cigarettes. If the proposal from anti-tobacco groups had been accepted, the price would have risen by 20.4%.

She further said, in FY 2020-21, the estimated amount of cigarette sales is 6400 crore sticks. If the proposal from anti-tobacco organization’s is implemented, this number will be reduced to 5400 crore stick. Besides, it will be possible to save 974 thousand people from death in the long run. The profit of the tobacco company this year is estimated at tk 5,040 crore. If our proposal is accepted, the profit of the company will be reduced to tk. 4350 crore. Controlling the spread of deadly goods must reduce the profits of companies that are growing at an incredible pace. She recommended to amend the proposed budget to introduce a specific tax system and impose taxes in accordance with the proposals from the anti-tobacco organization and adopt a comprehensive tobacco tax policy as soon as possible.

Discussing on the key note paper, the experts and guests said, the proposed budget did not increase the price of tobacco products at the desired rate. Government are not following the recommendations of anti-tobacco organizations and tobacco control experts, which is very unfortunate. If this continues, it will not be achieved tobacco-free Bangladesh by 2040 as the Prime Minister has announced, even in 2050. Because all the decisions in the proposed budget will go in favor of the tobacco company.

In order to acheve the dream of Hon’ble Prime Minister Sheikh Hasina to build a tobacco free Bangladesh by 2040, it is necessary to amend the proposed budget and impose taxes as per the proposal of the anti-tobacco organizations, they said.

More than 50 activists of various anti-tobacco organizations working in Bangladesh participated in the program.

Media Coverage:

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