Pakistan Wins Tobacco Control Award – But There are Gaps in the Picture

According to media website dawn.com, there are gaps in the picture with regard to the World Health Organisation’s award to Pakistan for its anti-tobacco efforts.

The country’s Ministry of National Health Services received the award on 31 May, which is celebrated as World No Tobacco Day. Among other actions, Pakistan was recognised for having made Islamabad a ‘tobacco-smoke-free city’, as well as for prohibiting all kinds of tobacco advertising, promotions and sponsorship, at point of sale as well as on social media.

And yet the reality on the ground points in another, troubling direction, reports dawn.com.

Access to smoking products is easy and the availability of the ostensibly banned single cigarettes is especially tempting for young people. The result is that more than 20% of the adult population in the country still smokes, costing the exchequer PKR 615 billion (almost $4 billion) in terms of the health burden.

Meanwhile, anti-tobacco activists have criticised the authorities for their lax tax policies towards the tobacco industry, which have helped this industry earn huge profits. Indeed, there have been no increased taxes on tobacco products in the past four years, whereas the price of other basic commodities has surged.

Another troubling issue (reported in thenews.com.pk) is that the owner of one of the local big tobacco companies – who also played a vital role in drastically reducing advance excise taxes payable by manufacturers on tobacco leaf – has recently been appointed to Pakistan’s Federal Board of Revenue (FBR) Policy Board. Not surprisingly, this has been flagged as a glaring conflict of interest.

The FBR Policy Board is an important platform in policymaking, especially for broadening the tax base, controlling tax evasion and increasing revenue generation. It plays a crucial role in making federal budget decisions relating to the taxation of a multitude of products, including cigarettes.

The appointment of the tobacco company owner to the FBR Policy Board seems to support the conclusion of an OCCRP (Organized Crime and Corruption Reporting Project) investigation, conducted in 2020, which found that Big Tobacco held an extensive influence in Pakistan. The OCCRP advised that some of the world’s largest tobacco companies had been complicit – and even actively involved – in the black-market production and trade of their own products in Pakistan.

Such strong influence may have been one of the driving factors behind FBR’s failure to implement a tax stamp and track and trace system on tobacco products.

‘Pakistan has been attempting to get a tax stamp programme off the ground for over 10 years and each time it has made an attempt the project has been somehow interrupted,’ said Michael Eads, a track and trace expert and customs/IT consultant to FBR.

‘At some point, the country is going to need to overcome these barriers and get on with it, given the country’s poor tax compliance in this area, high illicit trade and IMF commitments,’ he added.

According to the terms of the country’s $6 billion IMF bailout in 2019, Pakistan was supposed to have had track and trace in place by March 2020.

Given the weight of all the issues described in this article, it is therefore difficult to see how Pakistan’s tobacco control efforts, despite its achievements in some areas, could have been recognised with an award.