UNB, Dhaka :
Anti-tobacco campaigners have demanded introducing a ‘specific tax’ on tobacco products with the increase of tax rate from the upcoming 2017-18 fiscal, aiming to cut tobacco use in Bangladesh.
“Tobacco taxation is very complex and a non-pragmatic system in Bangladesh, which helps companies (tobacco companies) gain more profit,” said Dr Mahfuzur Rahman, a consultant to the World Health Organization (WHO).
In Bangladesh, all tobacco products are subject to an ad-valorem excise tax (supplementary duty), which is an indirect tax. There is a large variation in tax bases and tax rates, both between brands (for cigarettes slabs) and between tobacco products.
Dr Mahfuz said, tax burden on cheaper brands (lower cigarettes prices slabs) and cheaper products (bidis and smokeless) is much lower than the expensive brands, creating large price gaps between brands and products.
This complexity not only increases administrative costs for the government but also reduces the efficiency of the tax system as consumers can easily switch across brands and products when taxes increase, he added.
Anti-tobacco campaigners have demanded introducing a ‘specific tax’ on tobacco products with the increase of tax rate from the upcoming 2017-18 fiscal, aiming to cut tobacco use in Bangladesh.
“Tobacco taxation is very complex and a non-pragmatic system in Bangladesh, which helps companies (tobacco companies) gain more profit,” said Dr Mahfuzur Rahman, a consultant to the World Health Organization (WHO).
In Bangladesh, all tobacco products are subject to an ad-valorem excise tax (supplementary duty), which is an indirect tax. There is a large variation in tax bases and tax rates, both between brands (for cigarettes slabs) and between tobacco products.
Dr Mahfuz said, tax burden on cheaper brands (lower cigarettes prices slabs) and cheaper products (bidis and smokeless) is much lower than the expensive brands, creating large price gaps between brands and products.
This complexity not only increases administrative costs for the government but also reduces the efficiency of the tax system as consumers can easily switch across brands and products when taxes increase, he added.
