Tobacco companies violate FEA

Islamabad : Multinational tobacco companies have flagrantly violated the Federal Excise Act (FEA) and introduced a low-priced cigarette product with an aim to boost its sales at the cost of health hazards, Capital Calling warned.

Malik Imran, representative of Campaign for Tobacco Free Kids stated that the Federal Excise Act, 2005 says, “No manufacturer or importer of cigarette can introduce or sell a new cigarette brand variant at the same existing brand family at a price lower than the lowest actual price of the existing variant of the same brand family. For the purposes of this restriction, the current minimum price variant of the existing brand means the lowest price of a brand variation on the day of the announcement of Budget”.

He said no company is allowed to sell any product below the price set by the government in the Federal Excise Act 2005.

Similarly, said Malik, another multinational is flagrantly violating not only the above restriction imposed under the law, but also another restriction which states: “For the purpose of levy, collection and payment of duty at the rates specified in column 4, against serial number 9 and 10, no cigarette manufacturer shall reduce retail price from the level adopted on the day of the announcement of the latest budget.”

This is specifically prohibited under the law and any attempt to use fanciful labels to bypass the law is a direct violation of the laws of Pakistan, aimed at increasing smoker numbers. The principle behind increasing taxation is to make cigarettes more expensive; whilst these two multinationals are finding new ways of abusing Pakistani laws.

Dr Hassan Shehzad, from IIUI, said, seemingly, these actions run counter to WHO Framework Convention on Tobacco Control, to which Pakistan is a signatory. The WHO guidelines, he said, mentions that “Parties (countries) should require the tobacco industry and those working to further its interests to operate and act in a manner that is accountable and transparent. The tobacco industry should be required to provide Parties with information for effective implementation of these guidelines.”

Malik Imran said it is illegal because it is avoiding tax.

Tobacco expert Dr. Muhammad Zia said such introduction and dissemination/marketing of the products falls in the category of promotion of the tobacco product, which is completely illegal and ban in Pakistan by law. This is an additional violation of the law.

“Neither a company, nor any retailer can sell cigarettes by violating federal excise law.

Dr. Zia also said the tobacco control cell of the Ministry of National Health Services has become ineffective and not taking any action on such promotional activities.