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Budget to Increase Tobacco Use and Health Expenditure

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The proposed national budget for FY 2023-24, if adopted, will once again make tobacco products cheaper than essential commodities. It will encourage the youth into using tobacco products, increase tobacco-related deaths and illness, and therefore spike the public health expenditure of the government. The proposed budget, being at odds with the proposals of anti-tobacco activists, will cause the government to lose the chances of earning additional revenues and will also hinder the realization of a tobacco-free Bangladesh, as envisioned by the Honorable Prime Minister.

The proposed budget has increased the prices of 10 sticks of low-tier cigarettes from BDT 40 to BDT 45, which shows an increase of only BDT 0.50 (12.50 percent) in the price per stick. As the budget has proposed to increase only the base price and to keep the supplementary duty (SD) virtually unchanged, a large portion of the additional revenue will be pocketed by tobacco companies.

The prices for 10 sticks of medium-tier and high-tier cigarettes have been increased to BDT 67 from existing BDT 65 (3.08 percent increase) and to BDT 113 from existing BDT 111 (1.80 percent increase) respectively in the proposed budget. In the premium tier, the price for 10 sticks of cigarettes has been set to BDT 150 from existing 142 (5.63 percent increase). While the prices for 10 grams of jarda and gul have seen increases of BDT 5 and BDT 3 respectively, the SD imposed on these smokeless tobacco products have remained the same. In addition, the prices and SD of bidi have seen no change at all.

To put the changes of tobacco products’ prices into perspective, one may consider the increases in the prices of essential commodities in recent years. According to the Department of Agricultural Marketing (DAM), a govt. body that reports the prices of essential goods in eight metropolitan cities of the country (Dhaka, Chattogram, Rajshahi, Khulna, Sylhet, Barisal, Rangpur, and Mymensingh), the price of loose wheat flour increased by a staggering 71.7 percent between 7 March, 2022 and 7 March, 2023. The increases in price of per KG broiler chicken, sugar, a dozen eggs, powdered milk, red lentil, and coarse rice are 52.9 percent, 43.9 percent, 22.3 percent, 21.2 percent, 14.5 percent, and 9.9 percent respectively. On the other hand, the increases in the prices of tobacco products in the proposed budget ranges from almost negligible to virtually none. This will make tobacco products even cheaper compared to essential commodities and pose a threat to public health.

In his reaction to the proposed national budget, ABM Zubair, Executive director of PROGGA, said, ‘The base or retail price of low-tier cigarettes, which holds 75 percent of cigarette market share, has seen a negligible change. We demand that the government impose higher specific taxes on this tier and bring cigarettes out of the affordability of the people.”

The proposed budget has continued the opportunity to import e-cigarettes and vape products, which will hike the health risk facing the youth. E-cigarettes and vape products must be banned through finalizing the proposed amendment of tobacco control law.

Notably, the prevalence of tobacco use among Bangladeshi adults is 35.3 percent and tobacco claims 161,000 lives a year in Bangladesh.  The proposals of anti-tobacco activists, if realized, will result in 1.4 million users quitting tobacco, would raise BDT 9,600 crores in additional revenues and prevent the premature deaths of 4.88 lakh adults and 4.92 lakh youths. The additional revenue will help the govt. meet the ambitious goals set by the International Monetary Fund (IMF) for its loan assistance.

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