Tax Reform Model To Reduce Cigarette Consumption Ratio By 42 Percent

Tax reform model to reduce cigarette consumption ratio by 42 percent

Tobacco:New tobacco reforms would reduce cigarette consumption ratio in the country by 42 percent, a representative of Pakistan National Heart Association (PANAH) said on Friday

ISLAMABAD, (Pakistan Point News - 11th Jan, 2019 ) Tobacco:New tobacco reforms would reduce cigarette consumption ratio in the country by 42 percent, a representative of Pakistan National Heart Association (PANAH) said on Friday.

Speaking at a media conference titled 'Tobacco-free kids', Legal Advisor PANAH Malik Imran said the tobacco tax reforms model would also cut down smoking prevalence in adult from the current 10.4 percent to about 8.3 percent in three years.

Malik Imran said the measure would also help reduce the number of smoking-related deaths among current and future smokers by about 11 percent, making up to about 1.1 million persons.

The conference, organized by Society for the Protection of the Child (SPARC) in collaboration with Human Development Foundation and PANAH model of tobacco tax reforms, discussed tobacco taxation with a concrete proposal for tobacco tax reforms and recommend solutions to the Federal government on short term (Fiscal Years 2019/20), medium term (FY 2020/21) and long term basis (FY 2021/22).

The participants urged the government to implement measures to further strengthen the tax system by increasing the excise tax to reduce cigarette affordability.

They also called for harmonizing all taxes across tobacco products and full implementation of the Protocol to Eliminate Illicit Tobacco Trade, particularly the measures for supply and chain control, such as license, tracking and tracing, and record keeping, besides aligning the protocol with the legislation on prosecutions and sanctions for tax evasion.

According to estimates by SPARC, it is predicted that the tax reform will generate significant additional total tax revenue of about Rs 205.9 billion over three year, equivalent to an average annual increase in total tax revenue of about 51 percent (or about Rs 32.3 billion per year).

The experts anticipated an increase in the excise tax share in the price from about 45.9percent currently to 57.6 percent, somewhat closer to the 70 percent level recommended bythe World Health Organization.