Health advocates are calling for the immediate adoption of the latest World Bank recommendation to increase the federal excise duty (FED) on cigarettes. During a media interaction, the Society for the Protection of the Rights of the Child (SPARC) and health advocates stressed the importance of implementing this recommendation to secure a healthier and more prosperous future for Pakistan’s youth.

The World Bank’s recent report, the ‘Pakistan Development Update (PDU),’ highlighted a significant revenue gain of 0.4 percent of GDP (Rs 505.26 Billion) that could be achieved by applying the current rate on premium cigarettes (Rs. 16.50 per cigarette) to standard cigarettes. This measure, endorsed by Malik Imran Ahmed, Country Director of the Campaign for Tobacco Free Kids (CTFK), holds the potential for both economic and health benefits.

The current federal excise duty collection on various items in Pakistan contributes only 0.5% percent of GDP in revenue during FY21, with cigarette taxation accounting for 0.19% of the GDP. Aligning cigarette taxation with the World Bank’s recommendation becomes crucial for safeguarding children’s health and well-being, discouraging smoking, and generating essential revenue for public services.

Dr. Khalil Ahmed Dogar, Program Manager at SPARC, emphasized the government’s endorsement of the World Bank’s call for increased federal excise duty on cigarettes. This measure, aligned with the World Bank’s findings, can significantly enhance fiscal resources and public health outcomes, contributing to a safer and more prosperous future for Pakistan’s children.

Director of Waseela Foundation, Dr. Aman Khan, welcomed the World Bank’s recommendation for an increase in federal excise duty on cigarettes, addressing the issue of insufficient tax collection from cigarettes. The report suggests eliminating the dual tax rates on Slab One and Slab Two of cigarettes and implementing a single tax rate to address the region’s lowest cigarette prices due to leniency in cigarette taxes.