Tax burden on cigarettes in India is much below than international standards

In the India Cigarette Tax Scorecard, India got an overall score of 1.88 out of five possible points, which is slightly better than the South-East Asia average of 1.82.

Hyderabad: The current tax burden on cigarettes in India is far below the international best practises, according to the first edition of International Cigarette Tax Scorecard, which was released by Tobacconomics, based out of University of Illinois at Chicago’s Institute of Health Research and Policy.

In the India Cigarette Tax Scorecard, India got an overall score of 1.88 out of five possible points, which is slightly better than the South-East Asia average of 1.82, but lower than the global average of 2.07 and scores of top performing countries like Australia and New Zealand, which is at 4.63.

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“The scorecard shows considerable untapped potential for cigarette tax increases to raise revenue for a Covid-19 recovery and importantly, prevent premature deaths and promote a healthy and productive workforce,” Tobacconomics director and lead author of the scorecard, Frank J. Chaloupka, in a press release said.

Health economist and adjunct professor at Rajagiri College of Social Sciences, Kochi, Dr. Rijo John said the current tax burden on cigarettes in India is 52 per cent and is far below the standard of international best practice. “Lack of increase in taxes on tobacco products after the introduction of GST in 2017 has increased the affordability of cigarettes in India. India must significantly increase its existing excise taxes on tobacco products to save lives and raise much needed revenue,” he said.

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