Staff Reporter :
Adhunik, a national anti-tobacco organisation, in a reaction to the national budget proposals 2016-17 covering tobacco and tobacco products has expressed disappointment terming the tax increases for most parts as more symbolic than real as a deterrent to the use of the ‘deadly’ products.
Adhunik said this in a statement issued to the press on Saturday signed by its president Amanullah Khan on behalf of its central committee members.
He felt that such notional tax hike proposal will have negligible dent on an already high level of tobacco consumption rather it would act as an incentive instead of a disincentive to get people more attracted to smoking.
Amanullah Khan surmised there will be a big jump in the tobacco companies’ earnings, if the proposition to leave unchanged the existing tax rates on the mid and high end cigarettes, gets a nod from parliament. “If we take into account the inflation factor and the rise in the per capita income level, there’s a probability that the consumers of medium and high brand cigarettes will end up paying lower prices than the prevailing ones,” he elucidated.
“There are, however, some cold comforts for the anti-tobacco campaigners. For the lowest brand of cigarettes, the proposal is to raise prices by over a third while for two categories of ‘biris’ the proposed increases are 20 percent and about 17 percent of the ruling rates. It is apprehended that the price rises will be offset to a large extent by inflation and higher purchasing power in cases of these products as well,” Adhunik president pointed out.
“In addition, since a vast part of trade in smokeless/chewable tobacco still remains outside the formal sector of the economy and much of it is yet to be brought under the tax regime, levying a higher tax on them will have an insignificant and marginal impact,” he observed.
Anti-tobacco group’s recommendation to rationalise and simplify the current tax structure that seeks to apply different tax rates on different brands, creates opportunities for unscrupulous tobacco companies to manipulate and evade taxes, has remained unheeded,” Khan said.
“Adhunik has been pleading with the government for many years to impose an average straight 300 percent rise in tax rate on all tobacco products with little success. Unless the government opts for a geometrical progression in tax rate, the goal set by Prime Minister Sheikh Hasina to build a tobacco free Bangladesh by 2040 will prove to be illusive,” Adhunik president said.
“Low tax or no tax on tobacco would amount to a repudiation of one of the most effective tools the policymakers have in their armoury to contain the tobacco epidemic. It allows tobacco giants operating in Bangladesh to have their heyday. Such tax proposals will also impose an unbearable cost burden on the national health care system of Bangladesh already stretched to its limits,” Khan concluded.
Adhunik, a national anti-tobacco organisation, in a reaction to the national budget proposals 2016-17 covering tobacco and tobacco products has expressed disappointment terming the tax increases for most parts as more symbolic than real as a deterrent to the use of the ‘deadly’ products.
Adhunik said this in a statement issued to the press on Saturday signed by its president Amanullah Khan on behalf of its central committee members.
He felt that such notional tax hike proposal will have negligible dent on an already high level of tobacco consumption rather it would act as an incentive instead of a disincentive to get people more attracted to smoking.
Amanullah Khan surmised there will be a big jump in the tobacco companies’ earnings, if the proposition to leave unchanged the existing tax rates on the mid and high end cigarettes, gets a nod from parliament. “If we take into account the inflation factor and the rise in the per capita income level, there’s a probability that the consumers of medium and high brand cigarettes will end up paying lower prices than the prevailing ones,” he elucidated.
“There are, however, some cold comforts for the anti-tobacco campaigners. For the lowest brand of cigarettes, the proposal is to raise prices by over a third while for two categories of ‘biris’ the proposed increases are 20 percent and about 17 percent of the ruling rates. It is apprehended that the price rises will be offset to a large extent by inflation and higher purchasing power in cases of these products as well,” Adhunik president pointed out.
“In addition, since a vast part of trade in smokeless/chewable tobacco still remains outside the formal sector of the economy and much of it is yet to be brought under the tax regime, levying a higher tax on them will have an insignificant and marginal impact,” he observed.
Anti-tobacco group’s recommendation to rationalise and simplify the current tax structure that seeks to apply different tax rates on different brands, creates opportunities for unscrupulous tobacco companies to manipulate and evade taxes, has remained unheeded,” Khan said.
“Adhunik has been pleading with the government for many years to impose an average straight 300 percent rise in tax rate on all tobacco products with little success. Unless the government opts for a geometrical progression in tax rate, the goal set by Prime Minister Sheikh Hasina to build a tobacco free Bangladesh by 2040 will prove to be illusive,” Adhunik president said.
“Low tax or no tax on tobacco would amount to a repudiation of one of the most effective tools the policymakers have in their armoury to contain the tobacco epidemic. It allows tobacco giants operating in Bangladesh to have their heyday. Such tax proposals will also impose an unbearable cost burden on the national health care system of Bangladesh already stretched to its limits,” Khan concluded.
