Illicit cigarette market not as large as tobacco industry claims: WHO

ISLAMABAD: The World Health Organisation’s (WHO) new study found that there is no evidence that Pakistan’s illicit cigarette market is as large as the tobacco industry claims, but the illicit trade of cigarettes accounted for 23.1 percent of the total trade.

The study also stressed that the most effective way to reduce tobacco consumption was to increase the prices of tobacco products.

The world’s top health body emphasised that the prices of tobacco products in Pakistan should be increased by taxing the tobacco industry.

According to the study which is based on Pakistan Bureau of Statistics data, tax evasion on domestically produced cigarettes in 2015-16 amounted to Rs 53.8 billion in which Rs 38.9 billion, which is above 72 percent of the total share, was evaded by legitimate sector.

The study, refereeing to a survey conducted in the federal capital Islamabad, also revealed that Pakistan Tobacco Company (PTC) was one of the largest tobacco companies with a market share of over 56 percent in Islamabad, while Philip Morris International (PMI) had over 20 percent of the market.

The study found that the illicit market share was around 23 percent out of which 47 percent is smuggled and 45 percent is non tax paid. The study revealed that eight percent of the illicit market share is of counterfeit cigarettes.

Meanwhile, anti-tobacco activists have pressed the government to raise tobacco taxes to 70 percent of the retail price, in line with WHO guidelines, to combat the alarming rate of tobacco consumption among youth.

Malik Imran Ahmed, Country Head of the Campaign for Tobacco-Free Kids (CTFK), emphasised the need for urgent action, citing the significant impact of tobacco use on public health. “With over 60 percent of the population comprising youth, it’s crucial for the government to protect them from the ills of tobacco use,” he said.

He said the move was expected to generate additional revenue, surpassing Rs 200 billion by year-end, and help recoup healthcare costs associated with smoking-related illnesses. Tobacco consumption claims approximately 160,000 lives annually, accounting for 1.4 percent of Pakistan’s GDP in healthcare expenses.

Copyright Business Recorder, 2024