Azhar Saleem, CEO Human Development Foundation (HDF) stated that effective strategy for generating revenues from multiple sources can be a win for the government

Fiaz Ch

Islamabad Nov 12, 2020: In the wake of current Covid 19 pandemic, poverty is on the rise in low and middle income countries, especially Pakistan. The current financial crunch has dented the economic prosperity in these countries.

Azhar Saleem, CEO Human Development Foundation (HDF) stated that effective strategy for generating revenues from multiple sources can be a win for the government. One of these sources is the Health Levy Bill on cigarettes and sugary drinks. If the government implements this bill, it can open up a new avenue for revenues generation.

The Health Levy Bill was approved by the Cabinet of Pakistan in 2019 and forwarded to Federal Board of Revenue and relevant departments for further processing. In this bill, a surcharge of Rs. 10 was proposed on a pack of 20 cigarettes and Rs 1 per 250 ml of sugary drinks. As a result, up to Rs. 50 to 55 billion could be generated. This amount can take care of over one third of the total health burden being borne by Pakistan.

A representative of Campaign for Tobacco-Free Kids, Malik Imran, stated that last year the federal cabinet had approved the health levy on cigarettes and sugary beverages. ‘However, it could not be included in the finance bills of last year and the current year. As per our calculations, the exchequer has faced a loss of at least Rs40 billion from July 2019 to June 2020, he said.

Mr. Imran said that one of the partners had contacted the federal ombudsman for the implementation of the decision of the federal cabinet but during a hearing held on Oct 27 the Federal Board of Revenue (FBR) claimed that it had no objection over the health levy and cited the cause for no implementation a delay on part of the Ministry of National Health Services (NHS) in providing the draft bill. The Ministry of Health will be presenting its explanation at a next hearing with Federal Ombudsman.

Anti-tobacco activists urged the government to take serious notice of the delay in implementation of health levy bill. This revenue can be channelized for mitigating the overall health burden as well as the wellbeing of youth and nutrition of undernourished children. This way the economic burden can be reduced and a healthy society, free of tobacco addiction, be ensured.