A stitch in time saves nine

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The Finance Supplementary Bill, 2021, which has been popularly described as a ‘mini budget’ was introduced by the government in the National Assembly witnessed loud protests from the opposition ranks. Apart from the opposition, people have myriad expectations from the mini-budget of the who have been mired in the swamp of inflation, poverty, and unemployment. The government proposed to implement the tax of 144 essential items, however, the government will get only Rs 343 billion in revenue from the mini-budget. That will further increase the panacea of economic woes, if in their place only tobacco and sweet drinks were added to the tax, on an annual basis, the health burden would be less than one trillion rupees, diseases would be cured and billions of rupees of revenue could be earned.

The budget is an estimate of revenue and expenditure for a specific future period. Which is presented to the members of Parliament after being publicly compiled and re-examined. The state, in addition to generating budget revenue, takes into account the needs, resources, and problems of its people and institutions, or should do so. There are different types of budgets; an additional budget means that profits are expected, a balanced budget means that revenue is expected to be equal to expenditure, and a deficit budget means spending will outweigh revenues. The current mini-budget seems to be presenting a similar situation. If the tax over 144 items is approved, then after the implementation, the expenditure of the people will exceed their income, as a result of which there will be a further increase in inflation, poverty, and unemployment. By no means this does not mean, my dear readers are unfamiliar with the meaning of budget, no not at all, to tell the truth, I would like to draw your attention to the recent mini-budget and its affections.

According to the report of the Pakistan Institute of Development Economics (PIDE) dated April 25, 2021, the number of tobacco users in Pakistan is 24 million, which is one of the world’s largest tobacco users. While the total expenditure on diseases and deaths caused by smoking in 2019 was Rs 615.07 billion. Of course, from the past two years, there has been an increase in the number of tobacco users. In contrast, the tobacco industry pays only Rs. 120 billion as tax, which is only 20% of the total cost of smoking. Every year, the tobacco industry imposes higher taxes on tobacco products and declares the cause of the illegal trade of tobacco products, which is completely different from the facts. According to research, the total direct and indirect cost of smoking-related cancers, cardiovascular and respiratory diseases is Rs 437.76 billion. That’s 3.65 times higher than the total tax revenue from the tobacco industry (120 billion in 2019). Admittedly, People, directly and indirectly, costs by the use of tobacco. It is also a fact that a large proportion (71%) of the cost of smoking comes from cancer, cardiovascular and respiratory diseases, which account for 1.6% of the total cost of smoking. While the cost of cancer, heart, and respiratory diseases is 1.15% of GDP. Pakistanis are suffering from deadly diseases like heart disease, diabetes, obesity, cancer. On the other hand, Diabetes kills 1,100 people every day in Pakistan. In addition, the government faces a 2640 million annual health burden on diabetes-related diseases. According to the data of eight studies from different countries indicates, the consumption of sugary drinks increases the risk of diabetes by 30%. Similarly, obesity is a very important disease in non-communicable diseases, it is a major cause of heart, respiratory and other diseases. In 2015, the government faced a 428 billion health burden on obesity-related diseases. Unfortunately, like diabetes, one of the main reasons for this is the use of sugary drinks.

If we look at the collective cost of heart, cancer, diabetes, obesity, respiratory diseases, they exceed one trillion rupees. Its opponent has put a revenue estimate of Rs 343 billion in the mini-budget, recently presented in the parliament.  The essential goods for the common man will be expensive by increasing the tax. Which will gradually increase poverty, inflation, and unemployment, However, if only increase tax on the key factors that are causing diseases, not only will you be able to control diseases, but you will also be able to get rid of foreign loans, which will be a source of billions of rupees in revenue.

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