Surcharge on tobacco, sugary drinks can earn Rs50bn

KARACHI: Society for the Protection of the Rights of the Child (SPARC) organized “session on imposition of surcharge on tobacco products for supporting health infrastructure to fight COVID-19 pandemic, says a Press release.
Anti-Tobacco advocates drew the attention of Prime Minister Imran Khan towards a decision approved by the federal cabinet to implement a surcharge of Rs.10 on tobacco products and Rs.01 on sugary drinks that remain pending to date. Shahzad Qureshi MPA of Sindh Assembly from PTI said the government needs to adopt a futuristic approach and channelise the additional revenues into situations where financial setbacks are faced such as the current pandemic of coronavirus.
This additional 40 to 50 billion rupees will continue in lessening the financial crunch that the country is facing. He further urged the government to consider implementing the surcharge on cigarettes and sugary drinks on an immediate basis to generate the much-needed revenue. He further says provincial legislation also important so implementation can be improved.
Muhammad Kashif Mirza Media and Communication Manager SPARC said the country is facing a severe shortage of funds to combat the coronavirus (COVID-19). He suggested to the government to impose surcharge on tobacco products and sugary drinks that could generate Rs. 50 billion. He further added the full implementation of both taxes could earn Rs50 billion in revenue that could be used to purchase personal protective equipment (PPE) for health workers and testing kits required for the pandemic, he added.
He said both cigarettes and carbonated drinks have poor nutritious value and the sales trends show growing habit of smoking among youngsters and high consumption of soft drinks. Not only higher prices discourage youth from initiating cigarette smoking but encourage current smokers to quit, who are nowadays at a higher risk to coronavirus due to their decreased immunity.
Haris Jadoon Filed Manager said last year, the government announced a surcharge of Rs. 10 per pack of cigarettes and Rs. 01 per 250ml of sugary drinks. However, the surcharge approved by the cabinet was not presented in the financial bill 2019-20 and therefore could not be implemented.
He further said if the surcharge is imposed on cigarettes, the government will generate about Rs.40 billion per year in addition to the existing tax revenues and same is the case with sugary drinks.
Ms. Shumaila Muzzamil said that efficient imposition of taxes on these can decrease people’s access as their consumption is injurious to health and is increasing health burden of the country.
According to health experts and advocates, the severe shortage of funds faced by Pakistan to combat the coronavirus could be overcome by imposing a surcharge on tobacco products.