STAR BUSINESS REPORT

The government could lose an estimated Tk 4,000 crore in annual revenue in the upcoming fiscal year 2026-27 due to unrounded cigarette pricing, the Power and Participation Research Centre (PPRC) said yesterday.

The proposed budget for FY27 sets the minimum retail price for low-tier cigarettes at Tk 62 per 10 sticks and Tk 92 for medium-tier, said Mohammad Ihtesham Hassan, senior research associate at PPRC.

However, retailers sell low-tier cigarettes at Tk 7 per stick, making the effective pack price Tk 70, he added at a press conference on tobacco-related policies in the proposed budget, held at the Jatiya Press Club. For medium-tier, individual sticks are sold at Tk 10 each, pushing the actual pack price to Tk 100.

Based on 6,118 crore low- and medium-tier sticks sold in FY25, that untaxed gap translates to an estimated annual revenue loss of Tk 4,062 crore, Hassan said.

Low-tier cigarettes consistently generate the largest revenue share across all tiers. But after two consecutive tax-base increases in 2023 and 2025, both revenue and supply from this tier have fallen.

PPRC data show low-tier supply dropping from 6,890