Budget 2026-27 Proposes Higher Cigarette Prices Across All Tiers to Discourage Tobacco Use

The proposed national budget for the 2026-27 fiscal year includes a fresh initiative to raise cigarette prices across all market segments, as the government seeks to reduce tobacco consumption and improve public health outcomes through stricter fiscal measures.

According to officials familiar with the proposal, Finance Minister Amir Khosru Mahmud Chowdhury is expected to announce the revised pricing structure while presenting the national budget in parliament on Thursday.
 

Under the proposed framework, the minimum retail price for a pack of 10 cigarettes in the lower-tier category would increase from Tk60 to Tk62. Mid-tier cigarettes are set to witness a more substantial rise, with prices climbing from Tk80 to Tk92 per 10-stick pack.
 

The proposed budget also recommends increasing the price of high-tier cigarettes from Tk140 to Tk160 per pack, while premium or ultra-high-tier brands would see their prices rise from Tk185 to Tk210 for every 10 cigarettes.

If approved, the new pricing structure would raise the cost of lower-tier cigarettes by Tk2 per pack, while smokers of mid-range brands would pay an additional Tk12. Consumers of high-tier products would face an increase of Tk20, and premium cigarette users would see prices jump by Tk25.
 

Government officials said the move is intended to discourage tobacco use, particularly among young people and low-income groups, while also generating additional revenue for the state. Public health advocates have long argued that increasing tobacco prices remains one of the most effective methods for reducing smoking rates and preventing tobacco-related illnesses.

The proposed tax measures form part of the country's largest-ever national budget, which is scheduled to be formally unveiled in the Jatiya Sangsad. The budget for the 2026-27 fiscal year has been estimated at Tk9.38 lakh crore, marking a historic milestone in Bangladesh's fiscal planning.

The government has set a revenue collection target of Tk6.95 lakh crore, leaving a projected budget deficit of Tk2.43 lakh crore. To bridge the gap between income and expenditure, authorities plan to mobilise funds from both domestic and external sources.

According to budget documents, the government intends to secure Tk1.16 lakh crore through foreign loans and grants, while Tk1.27 lakh crore will be raised domestically. Of the domestic borrowing, Tk1.12 lakh crore is expected to come from the banking sector, with an additional Tk15,000 crore to be collected through savings certificates and other instruments.
 

The budget proposal is being presented in the presence of Prime Minister Tarique Rahman and under the chairmanship of Speaker Hafiz Uddin Ahmed. It marks the 55th national budget in Bangladesh's history and the first budget presented by Finance Minister Amir Khosru Mahmud Chowdhury under the current BNP-led administration.

Following parliamentary procedures, the budget will receive cabinet approval before being sent to President Mohammad Shahabuddin for final assent. Once enacted, the new fiscal measures, including the revised cigarette prices, will take effect from 1 July 2026.
 

Health experts have welcomed the proposed increase, saying higher tobacco prices can play a vital role in reducing smoking prevalence, lowering healthcare costs and protecting future generations from the harmful effects of tobacco use.