The current four cigarette price tiers (low, medium, high, and premium) have made tobacco pricing and taxes less effective. The small price difference between low and medium tiers allows consumers to switch between them easily. To reduce smoking among the poor and youth, and increase government revenue, the upcoming FY 2025-26 national budget could merge the low and medium tiers, reducing the number of tiers to three.
Speakers said these at a journalists' workshop titled "Tobacco Tax and Price Measures: Budget FY 2025-26" that took place on Thursday. The workshops, organized jointly by Progga (Knowledge for Progress) and ATMA (Anti-Tobacco Media Alliance).
It was informed that tobacco products in Bangladesh are already cheap. For the lack of an effective tax structure, these products are getting much cheaper and affordable when compared to the prices of essential commodities.
An analysis of the average retail prices of essential commodities in seven metropolitan cities of the country (Dhaka, Chittagong, Rajshahi, Khulna, Sylhet, Barisal and Rangpur) between July 4, 2021 and July 4, 2023, as reported by the Department of Agricultural Marketing (DAM), shows that price of loose sugar has seen a 89% hike in this time period, the hike is 87% for potatoes, 75% for loose flour, 47% for Pangas fish, 43% for eggs, 34% for soybean oil, 30% for powdered milk, and 27% for broiler chicken.
However, during this same timeframe, the hike in the prices of different tiers of cigarettes ranged between 6 -15% only. This is pushing the youth and the poor into getting hooked on the addiction of a cheap toxic product.
The proposals presented during the workshop for the FY 2025-26 national budget are as follows: The low and medium tier should be merged into one and prices for 10 sticks of the merged tier should be set at Tk90.
The retail price of high-tier cigarettes should be kept at existing Tk140 for 10 sticks. The prices for 10 sticks of premium cigarettes should be raised to Tk190. The supplementary duty (SD) on all cigarette tiers should be the existing 67%.
For non-filtered bidi, the retail price should be Tk25 for 25 sticks. In the case of filtered bidi, the retail price for 20 sticks should be set at Tk20. Both prices should be followed by a 45% SD.
Regarding smokeless tobacco, the retail price for 10 grams of jarda and gul should be Tk55 and TK30, followed by 60% SD. The budget proposals also suggest retaining 15% VAT on the retail prices of tobacco products and continuing the existing 1% health development surcharge (HDS).
In support of the proposals, speakers informed that budget proposals placed by anti-tobacco organizations, if realized, can help the government raise a staggering Tk20,000 crore in additional revenue, which will come in handy in reaching revenue targets and improve public health.
Implementation of such proposals, in the long run, will also help prevent the premature deaths of 1.7 million Bangladeshis, including nearly 900,000 youths.
The discussants in the workshop include Kawser Rahman, city editor, the Daily Janakantha; Sazzadur Rahman, deputy editor, The Business Standard; Mortuza Haider Liton, convener, ATMA; Nadia Kiron and Mizan Chowdhury, both co-convener, ATMA; ABM Zubair, executive director, Progga and Hasan Shahriar, head of Tobacco Control, Progga.
