Call for effective tobacco tax and price increase in the upcoming budget
The Economic Reporters’ Forum has called for effective taxation and price increases on Tobacco products in the upcoming national budget for fiscal year 2026–27 to protect public health.
The demand was made at a journalists’ workshop titled “The Need for Effective Tax and Price Increase on Tobacco Products in the Upcoming FY2026–27 Budget for Protecting Public Health,” jointly organised by Development Organisation of the Rural Poor-DORP and the Economic Reporters’ Forum at the ERF office on Monday.
The chief guest at the workshop was Zonayed Abdur Rahim Saki, State Minister for Planning. He said the easy availability of tobacco products in Bangladesh is alarmingly increasing smoking tendencies among young people and low-income communities, posing a serious threat to public health. He added that to reduce these health risks, it is not enough to merely raise tobacco prices; the increase must exceed the rate of inflation and income growth.
The special guest was Md. Mashiur Rahman, First Secretary (VAT Policy) of the National Board of Revenue. He said that due to the existing tobacco tax structure, the government is losing the opportunity to earn an additional Tk 44,000 crore in revenue annually. He noted that such a large amount could significantly improve the education, health and social security sectors. He added that effective tobacco taxation is a powerful policy tool that can reduce smoking, protect public health and simultaneously increase government revenue.
The keynote paper was presented by Prof. Dr. Shafiun Nahin Shimul, Director of the Institute of Health Economics, University of Dhaka. He stated that cigarettes are currently sold in four price tiers in the market: low, medium, high and premium. Nearly 90 percent of cigarette sales are concentrated in the low and medium tiers. Although adult per capita cigarette sales have remained almost unchanged in recent years, sales in these two tiers have increased. For the upcoming fiscal year, he proposed merging the low and medium tiers into one category, creating a new three-tier structure. Under the proposal, prices of 10-stick cigarette packs would be set at Tk 100, Tk 150 and Tk 200 respectively. He also recommended maintaining the existing 67 percent supplementary duty on all tiers and imposing a specific tax of Tk 4 per pack.
In his welcome speech, Daulat Akhtar Mala, President of the Economic Reporters’ Forum, said that before every budget, tobacco companies spread the false claim that increasing tobacco tax and prices would boost smuggling. He described the claim as baseless, saying cigarette prices in Bangladesh remain much lower than in neighbouring countries, leaving little scope for smuggling. He added that the Economic Reporters’ Forum would continue to play an active role in the media against such tactics, fears of revenue loss and rumours about counterfeit products.
Former Secretary Md. Azhar Ali Talukdar said Bangladesh has the highest tobacco use rate in South Asia at 35.3 percent. He noted that nearly 200,000 people die prematurely every year in the country from tobacco-related diseases. In 2024, the health and environmental losses caused by tobacco amounted to around Tk 87,000 crore, which is more than double the revenue earned from the sector (Tk 40,000 crore). He said there is no alternative to effective taxation and higher tobacco prices to reduce these losses, rather than viewing the sector solely as a source of revenue.
The workshop was chaired by AHM Noman, Founder and Chief Executive of DORP. He said that if the proposal for effective tobacco tax and price increases is reflected in the upcoming budget, more than 372,000 young people would be discouraged from starting smoking, and in the long run, over 185,000 premature deaths among the youth population could be prevented.
The session was moderated by Abul Kashem, General Secretary of the Economic Reporters’ Forum. Among others present were Md. Mostafizur Rahman, former Chairman
