[🇧🇩] Tobacco Industry in Bangladesh

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[🇧🇩] Tobacco Industry in Bangladesh
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Short Summary: Prospects and Challenges of Tobacco Industry in Bangladesh.

Saif

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Tobacco cultivation surge sparks alarm

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Tobacco cultivation in the Rangpur region has increased significantly this year, with 19,250 hectares of land now under cultivation, up from 13,349 hectares last year, according to the Department of Agricultural Extension.

The department has expressed concern over this rise, noting that the cultivation area stood at 10,820 hectares in 2023.

Officials report that 60 percent of the region's tobacco is produced in Lalmonirhat, followed by 20 percent in Rangpur, 15 percent in Nilphamari, and 5 percent in Gaibandha.

Farmers, meanwhile, cite the high profitability of tobacco as a reason for its increased cultivation.

Sejab Ali, a farmer from Tiparbazar village in Aditmari, expanded his tobacco farming from four bighas last year to seven this year, earning Tk 2,77,200 from 33 maunds of tobacco in 2024 while spending Tk 86,000.

Abdul Quader, a veteran farmer from Mominpur village in Rangpur Sadar, has been cultivating tobacco for 39 years and noted a sharp rise in its production this year. He doubled his cultivation from five to 10 bighas, attributing the trend to higher market prices and the support provided by tobacco companies, including seeds, fertilisers, pesticides, and interest-free loans.

Omar Faruk, agriculture officer of Aditmari upazila, criticised tobacco companies for encouraging cultivation, which he said depletes soil fertility and hampers food production.

Obaidur Rahman Mandal, additional director of DAE in Rangpur, said tobacco cultivation, though lucrative for farmers, harms the soil, environment, and human health.

He said the DAE cannot take firm measures as tobacco cultivation has not been officially banned, adding that its unchecked growth poses a severe risk to agriculture.Lalmonirhat Deputy Commissioner HM Raqib Hayder said measures to curb tobacco cultivation would be taken in consultation with the agriculture department, and the matter has been reported to higher authorities.​
 

Taxation is not only method to stop tobacco consumption: Farida
FE Online Desk
Published :
Jan 21, 2025 18:25
Updated :
Jan 21, 2025 19:17

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Fisheries and Livestock Adviser Farida Akhter said that taxation is one of the most effective methods to stop tobacco consumption but it is not the only method.

The adviser said this while addressing a seminar on tobacco organised by the non-government think tank Unnayan Shamannay at Bishwo Shahitto Kendro, BSS reports.

Referring to a research, Farida Akhter said that 35.3 per cent people in the country use tobacco, which means that one in every three persons is a smoker. This picture is both terrifying and worrying, she added.

She said that although the target of SDG 3.9 calls for a significant reduction in tobacco use to protect public health, the Tobacco Control Act needs to be amended and implemented immediately to make it effective by 2030.

The adviser said that the number of tobacco users will decrease if the National Board of Revenue imposes higher taxes. Tobacco companies are threatening to reduce revenue, she said, adding that but many studies have observed that tobacco use will decrease slightly but revenue will increase.

Moderated by Zahid Rahman, Senior Program Coordinator of Development Coordination, the event was attended by CTFK-Bangladesh Lead Policy Advisor Md. Mostafizur Rahman, BIDS Research Director Dr. S. M. Zulfikar Ali, and Anti-Discrimination Student Movement spokesperson Umama Fatema.​
 

NBR to conduct drive against illegal tobacco trading
Taufiq Hossain Mobin 09 February, 2025, 23:27

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This file photo shows the National Board of Revenue at Sher-e-Bangla Nagar in the capital Dhaka. | New Age photo

The National Board of Revenue has decided to conduct drive against illegal tobacco trading in the market to secure revenue collection from the sector.

NBR issued a directive in this regard on February 6.

The revenue authority instructed all VAT commissionerates to set up a six-member committee in each circle to improve tax collection from tobacco industry and crack down on illegal trade.

The newly formed committees will conduct daily inspections of markets, warehouses and other high-risk locations.

They will also collect intelligence report on illegal tobacco trading and take appropriate actions as necessary.

Each committee will be headed by the circle’s revenue officer as convener, while three members from law enforcement agencies would help tax officials in performing their job.

The NBR gave such instruction using the power stated in Value Added Tax and Supplementary Duty Act, 2012.

Circle officers will supervise the committees, while LTU VAT commissioners will provide consultations when required.

‘Recent media reports have highlighted the widespread availability of illegal tobacco products in both urban and rural areas, raising concerns about the government losing huge revenue and about the revenue authority’s ability to control the issue,’ the directive read.

Other members will include a representative from tobacco companies and an assistant revenue officer, who will serve as member secretary.

To ensure accountability, divisional officers will submit monthly reports on the effectiveness of these enforcement activities. The NBR also announced plans to recognise top-performing officers with a ‘Certificate of Recognition’ as part of the initiative.

The directive highlighted the importance of stricter monitoring due to rising concerns over illegal tobacco sales, which are causing significant revenue losses for the government.

Tobacco products, including cigarettes and bidis, contribute about 25 per cent of the country’s total VAT revenue, according to the directive.

By forming these bodies, the revenue board aims to tighten control over illegal tobacco sales and secure the stream of tax revenue.

A recent study, conducted by Bureau of Economic Research of the Dhaka University and the Bangladesh Network for Tobacco Tax Policy, said that the tobacco companies in Bangladesh evaded government revenue of Tk 3,784 crore during the 2023-24 fiscal by selling cigarettes at prices higher than the maximum retail price printed on the packets.

The study found that cigarette prices in the market exceeded the MRP by 8 per cent to 21 per cent during the 2023-24 fiscal.

Since government tax revenue is calculated based on the printed MRP, this price inflation benefits tobacco companies while depriving the exchequer of significant revenue.​
 

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