Study recommends taxing beedi industry to curb smoking, safeguarding workers’ interests
The Global Adult Tobacco Survey-2017 found that the beedi is the most popular form of smoked tobacco in India, with 7.7% of the adult population using it regularly.Updated: Mar 07, 2018 19:38 IST
A new study has recommended phasing out fiscal benefits and exemptions accorded to India’s beedi industry in the years to come.
The report — brought out jointly by the Public Health Foundation of India (PHFI) and the World Health Organisation — stated that 99.9% of the country’s beedi industry is unregulated, and around 89% of the people employed in its manufacturing units hail from the unregistered sector. It also noted that these workers, mostly women, are badly exploited — drawing just 17% of the annual wages earned by their counterparts in other sectors.
“As the entire industry is unregulated, it is less taxed but highly consumed. And not increasing taxes will lead to higher consumption in the future,” said Dr Sakthivel Selvaraj, director, health economics and policy, PHFI.
The Global Adult Tobacco Survey-2017 found that the beedi is the most popular form of smoked tobacco in India, with 7.7% of the adult population using it regularly. Around 28.6% adults consume tobacco in smoked and smokeless forms across the country, which accounts for 62% of the world’s 40 million deaths due to related ailments.
The joint study went on to state that despite high consumption, the beedi industry’s contribution to the national economy was a mere 0.65% of the Indian manufacturing industry’s GVA (gross value added). It recommended the registration of all such manufacturing units to ensure “better administration of welfare measures for beedi rollers” and an increase in taxes to lower usage of the product.
“A cost-benefit analysis of the beedi industry shows that we need to tax it as high as possible and, at the same time, provide alternative livelihoods to farmers and associated cottage industry workers,” said Selvaraj.
The National Health Policy-2017 aims to achieve 15% reduction in tobacco use by 2020, and 30% by 2025.
“It is unfortunate that the government indirectly subsidises the unregulated beedi sector by letting it get away without paying taxes. This makes the product cheap and easily accessible to the poor, who are among the most vulnerable,” said Dr Pankaj Chaturvedi, a cancer surgeon at the Tata Memorial Hospital in Mumbai.