Strong policy on tobacco taxation stressed to prevent tax evasion

A strong policy on tobacco taxation needs to be formulated to bring the existing tobacco tax system into an acceptable framework in a bid to protect public health and prevent tax evasion, anti-tobacco activists have said.

High prices of tobacco products and taxation have failed to reduce the consumption of tobacco products in Bangladesh owing to the "flawed" tax system, they observed.

The anti-tobacco activists were addressing a webinar, titled "Importance of Tobacco Tax Policy in Public Health Protection", organised by Bangladesh Network for Tobacco Tax Policy (BNTTP) on Wednesday.

Prof Golam Dr Golam Mohiuddin Faruque, the president of Bangladesh Cancer Society and member of BNTTP, was the main discussant. 

Aminul Islam Sujan, technical consultant of Vital Strategy, Sushanta Sinha, tobacco control researcher and member of BNTTP, and Palash Chandra Banik, associate professor of Department of Noncommunicable Diseases, Bangladesh University of Health Sciences, were panel discussants.   

Project Officer of BNTTP, Ibrahim Khalil delivered the keynote speech in the webinar moderated by the anti-tobacco platform's Research Associate Ishrat Jahan Oishee.

They mentioned that Prime Minister Sheikh Hasina in 2016 pledged necessary measures to adopt a strong tobacco-tariff policy. But even after seven years, no initiative has been taken to implement it. 

The existing ad valorem system of taxation on tobacco products is complex and flawed, and due to it, the number of tobacco users is not decreasing at the desired rate, despite the rising price of tobacco products, said the discussants.

According to BNTTP, around 1.62 lakh people die every year of tobacco-related diseases in Bangladesh. In fiscal year 2017-18, the financial loss [medical expenses and loss of productivity] due to tobacco-related diseases in the country was Tk30,560 crore. 

Addressing the webinar, the activists emphasised that there is no alternative to imposing a specific tax rate on tobacco products in the budget to bring down the death rate from tobacco-related diseases and increase government revenue.

Alleging that tobacco companies are evading government revenue in various ways, they claimed that around Tk4,500 crore revenue was evaded in the fiscal year 2022-23 by selling cigarettes at prices higher than the maximum price. 

The pricing of tobacco products each year is also failing to keep pace with inflation, they mentioned.