Call for higher tobacco tax in upcoming budget

Health experts, economists and government officials on Wednesday called for a significant increase in taxes and prices on all tobacco products in the upcoming FY2026–27 national budget, saying stronger taxation is essential to protect public health, discourage youth smoking and boost government revenue.

The demand came at a national seminar titled “The Necessity of Effectively Increasing Taxes and Prices on All Tobacco Products in the Upcoming FY 2026–27 Budget for Protecting Public Health”, organised by Development Organisation of the Rural Poor-DORP at the CIRDAP Auditorium in the capital.

Speaking as chief guest, Munshi Alauddin Al Azad said tobacco products in Bangladesh remain cheaper than many essential commodities, making them increasingly accessible to young people and low-income groups.

Citing data from the Department of Agricultural Marketing, he said prices of essential goods including sugar, potatoes, flour, eggs and soybean oil rose by 27 to 89 percent between 2021 and 2023, while cigarette prices increased by only 6 to 15 percent during the same period.

“As tobacco products have become more affordable, smoking rates are rising alarmingly, posing a serious threat to public health,” he said, adding that tobacco prices must increase at a rate higher than inflation and income growth to reduce health risks effectively.

Special guest Nahid Nowshad Mukul said the existing tobacco tax structure is depriving the government of nearly Tk 44,000 crore in additional annual revenue.

He said effective tobacco taxation could simultaneously reduce smoking prevalence, protect public health and strengthen state revenues for sectors such as education, healthcare and social protection.

Presenting the keynote paper, Dr. Shafiun Nahin Shimul proposed major reforms to the cigarette pricing structure.

He said Bangladesh currently operates a four-tier cigarette pricing system comprising low, medium, high and premium categories, with nearly 90 percent of cigarette sales concentrated in the low and medium tiers.

To curb tobacco use, particularly among youths and low-income people, he proposed merging the low and medium tiers and fixing the minimum retail price at Tk 100 per 10-stick pack, Tk 150 for the high tier and Tk 200 for the premium tier.

He also recommended maintaining a 67 percent supplementary duty across all tiers alongside a specific tax of Tk 4 per pack.

According to his estimates, implementing the proposed tax measures could prevent more than 372,000 youths from taking up smoking and save over 185,000 young people from premature tobacco-related deaths in the long term.

Director General of the National Tobacco Control Cell Md. Akhtaruzzaman said Bangladesh has the highest tobacco use rate in South Asia at 35.3 percent, while nearly 200,000 people die prematurely each year from tobacco-related diseases.

He noted that tobacco-related economic and environmental losses in 2024 amounted to around Tk 87,000 crore, which was more than double the revenue earned from the tobacco sector.

Referring to international experiences, he said countries including the Philippines, Turkey, Mexico and South Africa successfully reduced tobacco consumption and increased government revenue through stronger tobacco taxation policies.

He said the Philippines’ Sin Tax Reform led to a 28.1 percent decline in cigarette sales between 2012 and 2015 while tripling tobacco tax revenue, whereas South Africa witnessed lower smoking rates and a ninefold increase in revenue after strengthening tobacco tax measures.

The seminar was chaired by AHM Noman, while concluding remarks were delivered by Mohammad Nurul Amin. The session was moderated by Mohammad Jobayer Hasan.

Among others present were Md. Mostafizur Rahman, former Chairman of BCIC, Jeba Afroza, and other distinguished guests.