Experts disappointed over no hike in bidi taxes

Health experts have welcomed government's decision to increase excise duty on cigarettes but expressed disappointment over no hike in tax rates on bidis which they said claims more than seven lakh lives every year in India.
"Increasing excise on cigarettes is a welcome step by the Government. However, there has been no increase in tax rate on bidis. Small bidi manufacturers who produce less than 20 lakh bidis in a year avail exemption from paying excise duty," said Bhavna Mukhopadhyay, Executive Director of Voluntary Health Association of India, an NGO working for tobacco control.
Taxes on tobacco products in India fall well below the rate recommended by the World Bank - from 65 per cent to 80 per cent of retail price, Mukhopadhyay said, noting that while taxes on bidis are very low, averaging only 9 per cent of retail price, cigarette taxes account for approximately 38 per cent of the retail price.

Mukhopadhyay also observed that tobacco taxes in India are not regularly adjusted for inflation, and over time tobacco products are becoming increasingly affordable, leading to 1 million deaths annually.
"Raising tax on cigarette is welcome and it will be helpful to curb consumption. But why bidi remains exempted from any tax hike? The bidi industry kills users and exploits the manufacturer (bidi rollers). It is truly sad that government turns a blind eye to that segment. Despite hike of excise on cigarettes, India has one of the lowest taxes in the world.
"15 per cent raise in more than 65 mm cigarettes and 25 per cent hike in less than 65 mm is in sync with the inflation and can't be seen as a bold step by Finance Minister," said Dr Pankaj Chaturvedi of Tata Memorial Hospital, Mumbai.