Investment at the cost of letting people die.
A much needed tax requested by civil society which could save lives in Pakistan.
The 2024-25 budget formulation is at its full swing. The beverage industry is using traditional seductive tactics on the name of foreign investment and exports to Pakistani policy makers to escape taxes. The civil society of Pakistan and health professionals collectively rejects such tactics of the beverage industry and termed it plan for killing people by building a huge burden on the health sector and hence, economy of the country. Pakistan is a country with more than 1100 people dying daily due to diabetes and its complications, over 300 limbs amputated every day and a heart attack occurs every single minute. In a joint stamen issued, they requested FBR, IMF and Ministry of Finance to increase taxes on all type of sugary drinks to 50 % of the retail price.
“The cost of management of diabetes has increased to more than $2640 million in Pakistan in 2021. Sugary drinks are among the major risk factors of diabetes, heart diseases, cancer, liver and kidney diseases” said General Dr. Masuood Ur Rehman Kiani, President, Pakistan National Heart Association. “We have requested policy makers in Pakistan, to increase federal excise duty on all type of sugary drinks to reduce the diseases burden and saving precious lives.
Pakistan has low taxes on the beverage sector as compared to many other countries regionally and globally. For example, Saudi Arabia, Qatar, Oman, UAE and other gulf states have imposed 50% excise duty on sugary drinks and 100 % on energy drinks. Even India has a higher tax on beverage industry than Pakistan which makes 40 percent tax in total, which is one of highest of any product in India. The WHO data shows that more than 100 countries across the globe has already imposed high taxes on sugary drinks to discourage their consumption due to consequences on public health. The low taxes in Pakistan are encouraging the beverage industry to direct their investments to Pakistan creating serious threats to public health and economy of the country.
While Pakistan government is taking several measures to stabilize the economy, increasing tax on sugary drinks is an evidence based and sensible strategy to not only reduce the diseases burden, but also generate significant revenue in the best public interest” said by Munawar Hussain, Consultant Food Policy Program at Global Health Advocacy Incubator. While referring to the modelling study done by the World Bank, he said “If government increases 50% federal excise duty on all sugary drinks, it will bring health gain of 8500 DALYs, economic value of USD 8.9 million to public health and USD 810 million average annual tax revenue for the next ten years” he said.
Prof. Abdul Basit, Secretary General of the Diabetic Association of Pakistan and Head, WHO Collaborating Centre, Karachi humbly appealed to Finance Minister and Prime Minister of Pakistan for giving priority to Public health over the corporate interest by increasing FED on sugary drinks including sodas, energy drinks, juices, iced teas, flavored milk, syrups and squashes. “Pakistan is globally at top in term of prevalence of diabetes with every third adults living with the diseases.
This is a serious tragedy for our country as half of these are likely to develop kidney disease” he said. “Even the countries with established health system could not treat such a huge number of people. The prevention is the only option and best approach for any of the country” he added.
The civil society representatives said that policy makers need to stay alert from the several tactics used by the beverages industry to escape taxes “The beverage industry uses many tactics to misguide the policy makers to oppose taxes increase on sugary drinks. The research from Mexico, South Africa, Peru and other countries shows that taxing sugary drinks will reduce the consumption of unhealthy beverages but increase the consumption of heathier alternatives like bottled water and unsweetened milk”. said Sana Ullah Ghumman General Secretary PANAH. “Research confirmed that tax on sugary drinks have no net negative impact on economy or on the joblessness in the countries those who increased the taxes. We fully support FBR and Ministry of Finance to increase federal excise duty on all sugary drinks including juices which increases the price to 50 percent.
Editor: kamran Raja