Although the proposed budget for the next fiscal year keeps cigarette price tiers and tax rates unchanged, several popular cigarette brands are already being sold at higher prices in retail markets across the capital, causing confusion and dissatisfaction among consumers.
Retailers say they have not increased prices on their own. Instead, they claim they are being forced to charge more because wholesalers and distributors are supplying products at higher prices.
Replying to a question from a lawmaker during the question-and-answer session in parliament on Tuesday, Finance Minister Amir Khosru Mahmud Chowdhury said cigarette price tiers and tax rates in the proposed FY2026-27 budget had remained unchanged from the previous fiscal year.
As a result, cigarette prices are not expected to change in the new fiscal year.
However, visits to several areas including Ray Saheb Bazar, Wari, Sutrapur, Laxmibazar, areas adjacent to Dhaka University, Hatirpool, Katabon and Moghbazar found that a number of cigarette brands were being sold above their printed prices.
In the retail market, consumers are paying Tk22 to Tk23 for Marlboro Advance, Benson Switch and Marlboro Gold cigarettes that have a printed price of Tk20. Gold Leaf Switch, priced at Tk15, is being sold for Tk16 to Tk17, while Lucky Strike, with a listed price of Tk12, is selling for Tk13 to Tk14.
There have also been allegations that Camel cigarettes are being sold at prices exceeding their listed value, with some retailers charging up to Tk11 per stick. However, no complaints have yet emerged regarding Royal, Navy and Derby brands.
Mohammad Rafiqul Islam, a resident of Wari, said: “I heard cigarette prices would not increase in the budget. But when I go to shops, I have to pay one or two takas more than before. When I ask why, shopkeepers tell me prices have increased.”
Abdul Kader, a resident of Laxmibazar, alleged that prices vary from shop to shop. “Because there is no effective monitoring, retailers are charging whatever they want,” he said.
Retailers, however, reject accusations that they are responsible for the price increases.
A retailer in Sutrapur said: “We have not raised cigarette prices ourselves. We are selling based on the prices at which products are reaching us from the wholesale market. Compared with before, we are having to buy cartons at somewhat higher prices.”
Sobhan Mia, a shopkeeper in Moghbazar, said that although a price is printed on cigarette packs, supply shortages or higher procurement costs often make it impossible to sell at that rate.
Retailers claim cigarette cartons are supplied with a fixed number of packs.
Although cigarette prices and tax rates remain unchanged in the budget, many distributors and wholesalers have recently been charging an additional Tk20 to Tk100 per carton.
The impact is ultimately passed on to consumers, resulting in price increases of Tk1 to Tk2 per cigarette.
A wholesaler at Palashi Market said: “A carton that previously cost Tk3,800 now costs Tk3,900 or even Tk4,000.
That additional cost eventually translates into an increase of one to two taka per cigarette at the retail level.”
Traders complain they are not receiving clear explanations for the higher prices at the supplier level. In many cases, distributors cite new consignments, transport costs, commission adjustments or limited supply.
As a result, maintaining the printed retail price has become increasingly difficult.
Allegations of cigarette sales above the printed price are not new. A joint study by the Bureau of Economic Research (BER) at Dhaka University and the Bangladesh Network for Tobacco Tax Policy (BNTTP) found that during FY2023-24 cigarettes were sold in various parts of the country at prices 8 to 21 per cent higher than their printed Maximum Retail Price (MRP).
The study analysed data from 48 retail outlets across 12 locations.
According to the report, consumers are not the only ones losing out because of these higher prices; the government is also losing revenue.
Cigarette taxes and duties in Bangladesh are determined on the basis of the printed retail price. If cigarettes are sold at higher market prices, the additional amount collected from consumers remains untaxed.
BER and BNTTP estimated that such price manipulation resulted in a potential revenue loss of about Tk3,784 crore during FY2023-24 alone.
The study also found the greatest price disparity in lower-tier cigarette brands. A pack of 20 cigarettes with a printed price of Tk100 was sold at an average of Tk115.
Mid-tier cigarettes with a listed price of Tk140 were sold at Tk153, high-tier cigarettes priced at Tk240 were sold at Tk253, while premium cigarettes with a printed price of Tk324 were sold at Tk345.
