The World Health Organization (WHO) criticized Pakistan’s Federal Cabinet’s decision to keep its Federal Excise Duty (FED) on cigarettes unchanged in the 2025–26 budget, saying it will likely boost consumption and undermine public health. According to a WHO analysis, FED rates haven’t increased since February 2023, while inflation has surged 26%, resulting in declining real prices and even greater affordability.
For fiscal year 2024–25, WHO estimated cigarette production in Pakistan reached 37 billion sticks, generating Rs 208 billion ($728 million) in FED revenue. With excise duty unchanged, cigarette output is projected to rise to 38 billion sticks in 2025–26, yielding Rs 217.6 billion ($762 million) in revenue.
WHO says a Rs 39 ($0.14) per pack FED increase would reduce smoking by 10.7%, lower production to approximately 34 billion sticks, and increase revenues by 20.9%.
