recent survey by Centre for Research and Dialogue has linked an 18 percent drop in smoking rates in Pakistan to rising cigarette prices.

The survey found a marked decrease in cigarette consumption, with 15 percent of respondents reporting they had cut back due to higher prices. This translates into an estimated 11 billion fewer cigarettes smoked annually.

While these results are promising, Pakistan still has some of the world’s cheapest cigarettes. This highlights the need for further tax increases to curb smoking.

The government’s decision to raise FED rates by 146 percent for cheaper brands and 154 percent for premium brands in 2023 has been a key factor in the decline. Despite these increases, cigarettes in Pakistan are cheaper than in India, Sri Lanka and Bangladesh. A pack of premium cigarettes costs around $1.50 in Pakistan, compared to over $3.00 in the neighbouring countries.

The World Bank recommends a uniform tax structure for all tobacco products to further reduce consumption and boost government revenue. Their estimates suggest a revenue increase of 0.4 percent of the GDP if the current tax rate on premium cigarettes is applied to economy cigarettes as well

In Australia, a 25 percent cigarette price hike was found to have led to a 15 percent drop in smoking prevalence between 2010 and 2013. The UK saw a 12 percent reduction in smoking rates between 2011 and 2014 after a 20 percent price increase. Studies show that even a small rise in cigarette prices, can lead to a decrease in household spending on tobacco.

Maryam Gul Tahir, the CRD director, says the government should build on these gains and continue raising cigarette prices to maintain the decline in smoking. “Pakistan has a long way to go in tobacco taxation,” she says.

— By Ahmad Khan Badani

The writer is a researcher based in Islamabad