It makes sense that higher taxation rate on cigarette manufacturers may persuade smokers to switch to low-priced, tax-evading products if they are freely available, which they indeed are. Hence, higher taxes may encourage and create a heavier burden on the public-health expenditure.
Civil society should realize that the tobacco industry in Pakistan is among the highest taxpayers in Pakistan, while a much larger number of unregistered cigarette producers are not paying any taxes and selling their product at lower prices than the minimum rates set by the government.
One holds no brief for cigarette manufacturers but while we should look at raising taxes on the few companies that pay, the smarter thing would be for government and civil society to also take effective measures against those that are undermining the whole purpose of taxing cigarette makers to begin with. We hope that a stop will be put soon to illegal trade of cigarettes.
Siraj Munir
Karachi
