The government has proposed an increase in the supplementary duty on cigarettes from 65% to 66% as part of the national budget for FY2024-25. Finance Minister Abul Hassan Mahmood Ali presented the Tk 7,97,000 crore budget, emphasizing the need to reduce tobacco consumption and increase revenue from this sector.

“Cigarettes are outright harmful to human health. To reduce the consumption of tobacco products and increase revenue, I propose raising the supplementary duty on cigarettes to 66%,” stated the Finance Minister during his budget speech.

In addition, the minister proposed a hike in the Value Added Tax (VAT) on locally manufactured cigarette paper from 7.5% to 15%.

He also suggested increasing the price of various cigarette slabs: low slab (10 sticks per pack) to Tk 50, with a 60% supplementary duty; medium slab to Tk 70, high slab to Tk 120, and premium slab to Tk 160, with a supplementary duty rate of 65.5%.

For bidi products, the minister proposed maintaining the existing prices and duties: non-filtered 25-stick/pack at Tk 18, 12-stick/pack at Tk 9, and 8-stick/pack at Tk 6, with a 30% supplementary duty. Filtered bidi prices and duties also remain unchanged, with a 20-stick/pack at Tk 19 and a 10-stick/pack at Tk 10, both with a 40% supplementary duty.

The minister also recommended keeping the supplementary duty on Jarda at 55%, while increasing the maximum retail price to Tk 48 per 10 grams. The MRP of Gul would rise to Tk 25 per 10 grams, with the same duty rate.

According to the National Board of Revenue (NBR), the tobacco industry is one of the top tax-paying sectors, generating over Tk 32,502 crore in revenue from domestic cigarette sales alone in FY2023-24, marking an 8% increase from the previous year.