The government has proposed hiking the supplementary duty on cigarettes by 1 percentage point from 65 per cent to 66 per cent.
"Cigarette is outright harmful for human health. In order to reduce the consumption of tobacco and such kind of products and to increase revenue from this sector, I propose to fix supplementary duty at 66 per cent instead of 65 per cent on cigarette containing tobacco products stated in the second schedule of the Act," Finance Minister Abul Hassan Mahmood Ali said in his speech while presenting the Tk 7,97,000 crore national budget for FY2024-25.
“I propose to fix 15 per cent VAT instead of 7.5 per cent at local manufacturing stage on cigarette paper/bidi paper,” he said.
The minister also proposed to increase the price level of low slab 10-sticks/pack cigarettes to Tk 50 and higher and supplementary duty to 60 per cent. “Apart from this, I propose to increase the price level of medium slab 10-sticks/pack cigarettes to Tk 70 and higher, high slab to Tk 120 and higher and premium slab to Tk 160 and higher and the rate of supplementary duty for these three slabs to 65.5 per cent.”
“I propose to keep unchanged the MRP of non-filtered 25-stick/pack bidi at Tk 18, 12-stick/pack bidi at Tk 9 and 8-stick/pack bidi at Tk 6 and 30 per cent supplementary duty for all,” he said.
He also recommended continuing the existing price of filtered 20-stick/pack bidi at Tk 19, 10-stick/pack bidi Tk 10 and supplementary duty 40 present for all.
He proposed to continue the supplementary duty at 55 per cent with an increase of maximum retail price of Jarda to Tk 48 per 10 grams and MRP of Gul to Tk 25 per 10 grams.
According to NBR sources, tobacco industry is one of the top tax paying sectors and it generated more than Tk 32,502 crore in revenue from domestic cigarette sales (nearly 80 billion sticks) alone in FY2023-24, an 8 per cent increase from the previous year.
