A proposed restructuring of Bangladesh’s tobacco tax system could generate an additional Tk44,000 crore in revenue while preventing around 400,000 premature deaths in the long run, speakers said at a pre-budget discussion on Tuesday.
The proposal was presented by the Anti-Tobacco Media Alliance (ATMA) at a meeting held at the National Board of Revenue (NBR).
ATMA recommended merging the low and medium tiers of cigarettes into a single category, with a retail price set at Tk100 per 10 sticks. It also proposed fixing prices at Tk150 for high-tier cigarettes and Tk200 or above for premium brands. Additionally, the alliance suggested introducing a specific tax of Tk4 per 10-stick pack alongside the existing 67% supplementary duty.
NBR Chairman Md Abdur Rahman Khan said higher tobacco taxes have been effective in reducing consumption. “Further increases in taxes and prices will be considered in the future,” he said during the discussion.
Participants highlighted that the absence of effective price adjustments has led to a decline in the real price of tobacco products, making them more affordable relative to essential goods. According to 2025 data from the World Health Organization, cigarette prices in Bangladesh remain lower than in several regional countries, including India, Nepal, Bhutan, Sri Lanka and the Maldives.
To address this, ATMA proposed introducing a specific tax alongside the current ad valorem system, noting that at least 69 countries, including India, Thailand and Turkey, have adopted similar approaches. Such a system is considered more effective in raising minimum prices and simplifying tax administration.
The alliance also proposed setting a uniform price of Tk30 for 20-stick filtered and non-filtered bidis with a 50% supplementary duty. For smokeless tobacco products, it recommended fixing retail prices at Tk60 for zarda and Tk30 for gul per 10 grams, both subject to a 60% supplementary duty. It further suggested retaining the existing 15% VAT and 1% health development surcharge on all tobacco products.
Tobacco use remains a major public health concern in Bangladesh. Around 35.3% of adults use tobacco, and nearly 200,000 people die each year from tobacco-related illnesses.
In the 2024–25 fiscal year, the economic cost of tobacco-related health and environmental damage was estimated at Tk87,000 crore—almost double the revenue generated from the sector.
The meeting was attended by ATMA representatives, including journalists from various media outlets, along with NBR officials.