Effective tobacco taxation to reduce premature deaths, boost revenue: Experts

The government should reduce cigarette price tiers, introduce a specific tax system and increase the prices of all tobacco products in the upcoming 2026–27 national budget to reduce premature deaths and significantly boost revenue, experts suggested today (12 April).

They said the proposed measures could help prevent around 370,000 premature deaths in the long term, including nearly 185,000 among young people, while generating more than Tk85,000 crore in revenue – an additional Tk44,000 crore compared with the current fiscal year.

The recommendations were made at a workshop titled "Tobacco Tax and Price Measures: Budget 2026–27" held at BMA Bhaban in the capital, jointly organised by PROGGA (Knowledge for Progress) and Anti-Tobacco Media Alliance (ATMA).

Hasan Shahriar, head of programmes at PROGGA, said users of low- and medium-tier cigarettes – mostly from low-income and working-class groups – make up the majority of smokers. He said merging these tiers into a single category with higher prices would encourage low-income users to quit and discourage young people from becoming addicted to tobacco.

He added that introducing specific taxes would simplify the tax structure and improve administration.

According to the proposals, the low and medium tiers should be merged, with the price for 10 sticks set at Tk100. The retail price of high-tier cigarettes should be increased to Tk150 from Tk140, while premium cigarettes should rise to Tk200 from Tk185 per 10 sticks.

The supplementary duty on all cigarette tiers should remain at 67%, alongside a proposed specific tax of Tk4 per 10 sticks.

Experts also recommended introducing uniform pricing and taxation for both filtered and non-filtered bidi, setting the retail price at Tk30 for 20 sticks with a 50% supplementary duty. For smokeless tobacco, the retail price for 10g of jarda and gul should be raised to Tk60 and Tk30 respectively, from Tk48 and Tk25, followed by a 60% supplementary duty.

They also proposed imposing specific taxes on bidi, jarda and gul at rates to be set by the National Board of Revenue.

The proposals further suggest retaining the existing 15% VAT on tobacco products and continuing the 1% health development surcharge.

Experts said the measures could encourage nearly 500,000 adults to quit smoking and discourage around 372,000 young people from taking up the habit.

Participants at the workshop included Sazzadur Rahman, deputy editor of The Business Standard; Mortuza Haider Liton, convener of ATMA; Nadira Kiron and Mizan Chowdhury, co-conveners of ATMA; Hasan Shahriar; and ABM Zubair, executive director of PROGGA.