Cigarette tax not increased comparativly

Anti-tobacco platforms, state welfare policy makers and public representatives have long demanded a tax increase on tobacco products, but every year tobacco companies adopt various strategies to obstruct the process of tax increase on tobacco products.

A recent study by Work for a Better Bangladesh (WBB) Trust on ‘Tobacco Tax and Company Intervention’ revealed such information. The study was jointly conducted by Work for a Better Bangladesh Trust, Bangladesh Anti-Tobacco Alliance and The Union.

In the budget for the fiscal year 2020-21, the prices and tariffs of smoked and smokeless tobacco products have been slightly increased, although it is not at all consistent with inflation and increase in the purchasing power of the people. Even then, tobacco companies have been pushing for the withdrawal of these increased taxes in various ways. To date, the government has collected data on a total of nine areas of influence by tobacco companies to lift the increased tax on tobacco in 2020.

According to the study, some government MPs have claimed that the tax levied on bidis in the 2020-21 budget is much higher and that the tax on cigarettes has not been increased in comparison. They have sent a letter to the finance ministry demanding repeal of the increased duty. Some bidi companies are evading revenue of crores a year through buying fake band rolls from various smuggling ring instead of buying it from the concerned government departments. 

As in the past few years, a few days before the budget announcement, there was a tendency for tobacco companies to illegally stockpile cigarettes and create artificial crisis in the market to increase prices. After the announcement of the 2020-21 budget, the tobacco companies were campaigning for themselves through various media and social media. Even after the government set taxes and prices on tobacco, British American Tobacco submitted a recommended price list. 

Moreover, at present, there are many short videos on Facebook and YouTube aimed at reducing the price of tobacco. Bidi workers, under the banner of 'Bangladesh Bidi Sramik Federation', staged a human chain in front of National Board of Revenue to protest against discriminatory tariff increase on bidis in 2020-21 budget and handed over a memorandum to the chairman of NBR.

The research report made several recommendations to improve the situation. The recommendations includes, formulating a long-term and up-to-date tax structure; taking immediate action by the government to identify areas where tobacco companies are intervening; Introducing standard packaging system and use digital barcode etc.