A supplementary duty of 65.5% has been proposed for three tiers of cigarettes, Finance Minister Abul Hassan Mahmood Ali presented the proposed national budget on Thursday (6 June).
‘Cigarettes are extremely harmful to human health. To reduce the use of such harmful products and increase revenue collection, I propose to fix the supplementary duty rate at 66 percent instead of 65 percent," the minister said in his budget speech.
The maximum retail price for 10 grams of jarda is proposed to be Tk48, and for the same amount of gul, Tk25.
He also recommended increasing the value-added tax on the local production of cigarettes and bidi paper (a type of cheap cigarette made of unprocessed tobacco wrapped in leaves) to 15 percent instead of the existing 7.5 percent.
One of the top tax-paying sectors, the tobacco industry generated more than Tk32,502 crore in revenue from domestic cigarette sales (nearly 80 billion sticks) alone in the 2023-24 fiscal year, an 8 percent increase from the previous year, according to data obtained unofficially from a source of the National Board of Revenue.
Recent data shows that around 37.8 million people, which is 35.3% of the population, use tobacco in the country.
Additionally, about 1.5 million people are suffering from tobacco-related illnesses. The government spends much more on treating these diseases than it earns from the tobacco industry.
According to the National Heart Foundation of Bangladesh and Platform Doctors Foundation, tobacco-related diseases cause the deaths of around 161,000 people each year, leading to significant economic losses.
