Hike Cigarette Taxes, Says Pakistan Health Ministry

April 11, 2018 Taxation in Pakistan

cigarette taxesISLAMABAD – Cigarette taxes in Pakistan need to be raised, not lowered, says the national Ministry of Health Services.

The Ministry of National Health Services, Regulations and Coordination of Pakistan has called on the government to raise taxes on cigarettes sold in the country, as the move could boost tax revenues and have positive health effects for taxpayers.

The Ministry is calling for their previously proposed plan to be enacted, with a PKR 44 tax on each 20 pack of cigarettes sold.

The tax is forecast to result in a 13.2 percent drop in smoking rates in the country, a PKR 39.5 billion rise in tax revenues, and a 0.65 million drop in premature deaths in the country.

However, despite the Ministry’s recommendations, the government has implemented a PKR 16 per pack tax, which it claims was aimed at fighting the occurrence of black-market cigarette sales.

The reduced tax rate did raise tax revenues, however, it has not been shown to have a positive effect on cessation rates.

The Ministry is calling for the next budget to contain their proposed hiked taxes.