Cigarettes to get pricier as govt eyes more revenue

Finance Minister Kamal presented the budget for FY24 in parliament on Thursday, where he mentioned the goal of reducing the number of smokers

Finance Minister AHM Mustafa Kamal has proposed to increase the revenue collected from cigarette smokers.

As a result, the price of each cigarette pack will increase by Tk 2-8 depending on the quality. However, considering the plight of low-income individuals, there has been no proposal to increase the price of bidis. But Kamal plans to increase the prices of jarda and gul.

On Thursday, Kamal presented the budget for the new fiscal year in parliament, where he mentioned the goal of reducing the number of smokers.

However, two non-governmental organisations working to discourage smoking said that the price of cigarettes has not increased significantly in comparison to the rising prices of daily essentials in the country. Kamal has indirectly encouraged smoking by keeping the price relatively low, according to them.

In his budget speech, Kamal proposed to increase the prices of low-tier cigarettes to Tk 45 per pack and supplementary duty to 58 percent.

The government plans to increase the prices of a medium-tier pack of cigarettes to Tk 67, a high-category pack to Tk 113 and a premium pack to Tk 150. The rate of supplementary duty on these three slabs remains unchanged at 65 percent.

“I propose to continue the supplementary duty at 55 percent with an increase of MRP of Jarda to Tk 45 per 10 grams and MRP of Gul to Tk 23 per 10 grams.”

According to anti-tobacco activists, the proposed budget will cause the government to lose the chances of earning additional revenues and will also hinder the realisation of a tobacco-free Bangladesh, as envisioned by the prime minister.

As the budget has proposed to increase only the base price and to keep the supplementary duty virtually unchanged, a large portion of the additional revenue will be pocketed by tobacco companies, they said.

In his reaction to the proposed national budget, ABM Zubair, executive director of PROGGA, said, “The base or retail price of low-tier cigarettes, which holds 75 percent of cigarette market share, has seen a negligible change. We demand that the government impose higher specific taxes on this tier and bring cigarettes out of the affordability of the people."

The finance minister also sought to stop the import of e-cigarettes and vaping products in the proposed budget.