Tobacco Tax Not Enough, Hike On Cigarette Tax A Misnomer: Experts
In the first budget of Amrit kaal, Finance Minister Nirmala Sitharaman announced a 16 per cent increase in National Calamity Contingent Duty (NCCD) on cigarettes. Experts have said that the prevailing discrepancies in tobacco taxation was yet again ignored in the budget 2023.
“The 16 per cent NCCD increase on cigarettes will only have the effect of increasing total cigarette taxes by 1.8 per cent and its impact on retail price will be about 1 per cent,” health economist Dr Rijo M John, professor at Rajagiri College of Social Sciences, Kochi, said calling the hike a misnomer. This in turn will be used by tobacco industry as excuse to hike cigarette prices, Rijo added.
Conveying his disappointment over stalled tax hike on tobacco for more than 5 years, Rijo stated, “NCCD itself constitutes less than 10 per cent of taxes applied on cigarettes. So, it's 16 per cent increase of that less than 10 per cent.”
India is a part of 182 countries that signed the WHO framework convention on tobacco control recommending at least 75 per cent tax on retail price of all tobacco products. But in India, taxes on cigarettes are 52.7 per cent, bidis are 22 per cent, and chewing tobacco is 63.8 per cent.
With the recent study from ICMR, suggesting one in every nine persons in India is at risk of developing cancer in his or her lifetime, tobacco taxation can play a major role in protecting public. As tobacco use is a major risk factor for many chronic diseases, including cancer, lung disease, cardiovascular disease and stroke.
WHO reports that tobacco is one of the major causes of death and disease in India and accounts for nearly 1.35 million deaths every year. Moreover, India is the second largest consumer and producer of tobacco.
As per Global Adult Tobacco Survey India, 2016-17, nearly 267 million adults (15 years and above) in India (29 per cent of all adults) are users of tobacco with the most prevalent form of tobacco being the smokeless tobacco.
“With 267 million tobacco users in India, the benefits of raising taxes on tobacco would be overwhelmingly positive for people’s health, preventing many from initiating or continuing tobacco use, and on our healthcare system. Urgent action is needed to tackle the tobacco epidemic and comprehensive taxes on all tobacco products would be a life-saving measure,” said L M Singh.
The total economic costs attributed to tobacco use from all diseases in India in the year 2017-18 for persons aged 35 years and above amounted to INR 1,77,341 crore (USD 27.5 billion), as per WHO.
Following the announcement, the tax on filter cigarettes with a length between 70 and 75 mm will increase from 545 to 630 rupees per 1000 sticks. Filter cigarettes longer than 65 mm up to 70 mm would cost Rs 510 instead of Rs 440 per 1000 sticks, while filter cigarettes shorter than 65 mm will cost Rs 510 instead of Rs 440.
More than 80 per cent of the 1.3 billion tobacco smokers worldwide reside in low- and middle-income nations.
Following the announcement, the tax on filter cigarettes with a length between 70 and 75 mm will increase from 545 to 630 rupees per 1000 sticks. Filter cigarettes longer than 65 mm up to 70 mm would cost Rs 510 instead of Rs 440 per 1000 sticks, while filter cigarettes shorter than 65 mm will cost Rs 510 instead of Rs 440.
More than 80 per cent of the 1.3 billion tobacco smokers worldwide reside in low- and middle-income nations. Amidst this experts weren’t satisfied with 16 per cent increase in National Calamity Contingent Duty (NCCD) on cigarettes this budget.
.jpg)
