The National Institute of Health (NIH) has begun accepting recommendations from stakeholders regarding the proposed rise in cigarette prices, as per the available information.
According to sources, NGOs have proposed increasing the Federal Excise Duty (FED) on tobacco by 26.6%.
Sources indicate that the Tobacco Control Cell has concluded its suggestions for increasing the cost of cigarettes in the 2025 budget.
Sources indicate that the Ministry of Health will conclude these proposals and transmit them to the Ministry of Finance this week.
Sources familiar with the topic have indicated that there is a potential for a 15% to 19% rise in the Federal Excise Duty (FED) on tobacco in the 2025 budget.
Additional tax on tobacco goods suggested
Presently, the Pakistani government is imposing a Federal Excise Duty (FED) of Rs120 on each pack of cigarettes, whilst cigarettes produced by the local industry are being sold at a price of 90 rupees per pack.
Last year, multinational cigarette makers contributed Rs173 billion in taxes, while local cigarette manufacturers avoided paying Rs240 billion in taxes.
Pakistan is confronted with a substantial issue of extensive tobacco consumption, as more than 31.9 million individuals aged 15 years and over are currently using tobacco, accounting for around 19.7% of the adult population.
Each year, smoking-related illnesses cause the death of more than 160,000 people, which accounts for a significant 1.6% of the country’s Gross Domestic Product (GDP). Nevertheless, for the fiscal year 2022-23, the revenue generated from cigarette taxes accounted for only 16% of these expenses, indicating a decrease from 19.5% in 2019.
