Government considers cutting tobacco duty to MVR 4 after WHO study, says Ihusaan

The government is considering reducing the duty on tobacco products to MVR 4, following a recommendation from the World Health Organization (WHO), Homeland Security Minister Ali Ihusaan said on Sunday.

Speaking at the World No Tobacco Day press conference held at the President’s Office, Ihusaan said the government had taken a “very difficult decision” last year to raise the duty on tobacco from MVR 3.50 to MVR 8. The increase, he said, was introduced to prevent a sudden shift to cigarettes after the nationwide vape ban.

“All countries increase duties to control tobacco. But our change to MVR 8 was mainly to control the shift to tobacco because of the vape ban, based on the research and expert advice we had,” he said.

Ihusaan said the government is now reviewing the duty structure again to ensure both the vape ban and tobacco‑control measures remain sustainable. As part of that review, he said WHO has recommended lowering the duty to MVR 4.

“This is a rate we are considering. We will discuss it with all relevant agencies and stakeholders. If there is agreement, the government will submit the recommendation to Parliament,” he said.

He added that the government will also consider the views of major financial institutions and technical experts before making any changes.

Tobacco prices rose sharply after the duty increase in November 2024, with the price of a pack of cigarettes jumping from around MVR 110 to MVR 250. Traders say cigarette sales have since declined, while the market for home‑made cigarettes, rolling tobacco and smuggled products has grown.

It is of interest to note here that WHO has never before recommended reducing tobacco duties in Maldives.The World Health Organization always recommends that tobacco excise taxes should account for at least 70 percent of the retail price. They frequently have applauded the Maldives for hiking, not reducing, its tariffs.