Proceeds from tobacco surcharge remain unused

The health development surcharge collected on all tobacco products has remained unused, although nearly three years have passed since the government levied it.

The government imposed a 1 percent surcharge on all domestically produced and imported tobacco products from fiscal 2014-15, with the proceeds to be used for 'treatment and rehabilitation of tobacco disease-stricken people'.

Since then, revenue officials have collected more than Tk 600 crore as surcharge, mainly from cigarette manufacturers, according to the National Board of Revenue.

However, delays in framing the Health Development Surcharge Management Policy are holding up the use of the funds to curb the consumption of tobacco and tobacco products and strengthen the control of non-communicable diseases.

Recently, the health and family welfare ministry has prepared a final draft of the policy, according to officials.

The policy will be placed to the cabinet for approval, said Roxana Quader, additional secretary to the health ministry.

Officials said the health ministry does not have access to the money to use for campaigns to control tobacco and curb the spread of non-communicable diseases.

Initially after imposition of the surcharge, the health ministry had approached the finance ministry for access to the funds.

But the finance ministry suggested formulation of a policy to ensure proper and planned use of the money.

Based on the recommendation, the National Tobacco Control Cell under the health and family welfare ministry prepared a draft policy early last year and finalised the documents based on consultation with various stakeholders, including other ministries and agencies, officials said.

A senior official of the health ministry said they could not finalise the draft policy because of delays in getting opinions and recommendations from all stakeholders.

“We could have used the money to control tobacco usage had we gotten the budget earlier,” he said.

The NBR collected Tk 193 crore as health development surcharge from cigarette manufacturers in the first ten months of the current fiscal year.

In fiscal 2015-16, the sum was Tk 207 crore and in fiscal 2014-15 Tk 205 crore, according data from the revenue authority.

Meanwhile, the government in fiscal 2014-15 slapped a 1 percent surcharge on the prices of mobile handsets and in March last year, an equal percentage of surcharge on the use of mobile phones.

The government said the proceeds from mobile handsets and their usage will be spent for health and education purposes.

As of April, nearly Tk 240 crore has been collected as surcharge on mobile phones and their usage.

Matiur Rahman, commissioner of Large Taxpayer Unit that collects most of the surcharge from cigarette manufacturers and mobile phone operators, said along with framing policies a panel with representation from both public and private sectors can be formed to ensure the transparent use of surcharges.