Union budget 2024: Experts push for higher tobacco taxes says report

In anticipation of the upcoming Union Budget 2024–25, a consortium of medical professionals, economists, and public health advocates have united to press the government for increased excise duty on tobacco products. Their collective plea emphasizes the pivotal role of augmented taxes in curbing tobacco usage and bolstering public health initiatives, reported PTI.

The call for higher excise taxes on tobacco encompasses cigarettes, bidis, and smokeless tobacco, aligning with the broader strategy of imposing health taxes, commonly referred to as sin taxes. These levies specifically target products like tobacco that pose severe public health risks.

Recent studies have exposed a disquieting trend: the affordability of cigarettes, bidis, and smokeless tobacco has surged over the past decade. Dr. Rijo John, a distinguished health economist from Rajagiri College of Social Sciences told Mint that the inadequacy of significant tax hikes on tobacco products since the introduction of the Goods and Services Tax (GST) in July 2017. He noted that the current tax burden remains insufficient, constituting only a fraction of the final retail price.

Dr. John highlighted a concerning consequence of the government's reluctance to escalate tobacco taxes. When taxes stagnate, tobacco companies independently amplify prices, elevating their profits while circumventing potential government revenue.

Dr. Pankaj Chaturvedi, Head Neck Cancer Surgeon at Tata Memorial Hospital, reiterated the imperative to hike tobacco taxes, citing that nearly 50% of all cancers in India stem from tobacco usage. He emphasized the dual benefits: reduced affordability leading to diminished consumption, benefitting both users and the nation, reported Mint.

A recent report by the Parliament Standing Committee on Health underscored the grim reality of India's battle against cancer, identifying tobacco as the leading cause of oral, lung, esophageal, and stomach cancers.

With India claiming the unenviable second spot globally for tobacco users, accounting for a staggering 268 million individuals, experts assert that a tax hike can contribute significantly to mitigating the devastating impact of tobacco-related diseases, preventing approximately 13 lakh deaths annually.