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FBR to impose health levy on tobacco products and sugary drinks

FBR to impose health levy on tobacco products and sugary drinks

LAHORE: The Ministry of Law and Justice has allowed the Federal Board of Revenue (FBR) to impose health levy on tobacco products and sugary drinks through an ordinary bill or through an ordinance before the upcoming budget.

In response to a letter from the FBR, the law ministry has said the proposed federal health levy would fall within the definition of fiscal laws for the purpose of the act.

“In the light of the restriction in the use of funds collected pursuant to the proposed law, it will not constitute a money bill,” the ministry said in a letter to the FBR.

The imposition of the federal health levy on the manufacturing and sale of harmful products falls within the domain of the parliament under the Constitution, therefore, the imposition of the said levy on such sale and manufacturing would be applicable throughout Pakistan, the law ministry said.

The federal cabinet approved the health levy in 2019, but it is yet to be implemented. The levy proposes a Rs10 per cigarette tax to discourage smoking among the youth and help the government raise its revenue from the tobacco products.

According to data of the Ministry of National Health Services (NHS), smoking has been resulting in 166,000 deaths in Pakistan each year and according to a study tobacco-related diseases were causing an annual loss of Rs615 billion to the national exchequer.

Anti-tobacco activists have welcomed the law ministry’s decision and urged the FBR to enforce the levy across the country before the upcoming budget.