Experts urged stronger tobacco taxation in Pakistan’s Federal Budget 2026-27, saying tighter cigarette taxes could improve public health and raise domestic revenue.
Participants made the recommendation at a Sustainable Development Policy Institute policy dialogue in Islamabad on Thursday.
Syed Ali Wasif Naqvi, Senior Research Associate at SDPI, said a one-percentage-point reduction in smoking prevalence could recover about Rs294 billion in economic losses. He said the same reduction could generate more than Rs103 billion in additional tax revenue.
Naqvi said Pakistan, as a lower-middle-income country, remains below optimal tobacco taxation levels.
He called for a review of the two-tier cigarette tax system, saying industry influence had partly kept rates stagnant.
Dr Sajid Amin Javed, SDPI Deputy Executive Director, described tobacco taxation as a “win-win” policy for revenue, public health, and economic stability.
He suggested higher taxes on commonly consumed cigarette brands and said authorities should earmark the revenue for health-sector improvements.
Waseem Iftikhar Janjua, SDPI Senior Advisor, said the gap between premium and economy cigarette taxes encouraged smokers to shift to cheaper brands rather than quit.
He recommended automatic annual excise increases that outpace inflation and gross domestic product growth under a three-to-five-year reform roadmap.
Janjua said Pakistan’s cigarette tax share remains below the 70% retail price benchmark recommended by the World Health Organisation Framework Convention on Tobacco Control.
Dr Ashar Malik of Aga Khan University said all tobacco products, including smokeless forms, should be covered by stronger taxation and legislation.
Dr Irfan Chatha, SDPI Research Fellow, said Pakistan’s cigarette consumption remains around 80 billion sticks annually and called for taxation, enforcement against illicit trade and better institutional coordination.
