BACKGROUND: Despite taxation policies targeting full cigarette packs, the sale of single-stick cigarettes in Bangladesh remains unregulated and widespread. Retailers sell single sticks at disproportionately higher prices than their per-stick cost in a 10/20-stick pack. This pricing manipulation undermines taxation policies and facilitates tax evasion. For example, the cost of 20 single sticks is approximately 3.4%–7% higher than the price of a full 20-stick pack, which itself is often priced above the Maximum Retail Price (MRP). Tobacco companies supply cigarettes to retailers at pack rates, forcing them to charge more to cover costs. Additionally, companies advertise single-stick pricing in retail shops, deliberately setting it higher. Exploiting this practice and maintaining consumer affordability, they evade taxes. The absence of standardized pricing mechanisms further exacerbates the issue.
METHODS: Quantitative data were collected from 48 retail outlets across 12 cities in Bangladesh, including divisional cities and district towns. Four outlets were selected from public places such as hospitals, courts, bus stands, and markets. The study analyzed 31 cigarette brands across premium, high, medium, and low tiers. Revenue loss was estimated by comparing MRP on full-pack sales with inflated single-stick prices.
RESULTS: The study estimates that revenue evasion from 20-stick packs, sold above the MRP, amounts to 3.783.683 crore BDT in FY 2024-2025. Including inflated single-stick pricing, the loss increased to 6.317.486 crore BDT, with an additional 2.533.803 crore BDT (approx. $220 million) lost annually. Single-stick sales, therefore, significantly contribute to tax revenue losses, undermining the effectiveness of existing taxation policies.
CONCLUSIONS: The widespread sale of single-stick cigarettes undermines taxation policies and public health objectives in Bangladesh, resulting in substantial revenue losses. Effective regulatory measures, including a ban on loose selling cigarettes, enforcing standardized pricing, and strengthening enforcement mechanisms, are crucial. These interventions can reduce revenue losses, enhance tobacco control policies, and ultimately improve public health outcomes.