Govt considers 50% reduction in cigarette duty

The government is considering reducing cigarette duty by 50 per cent and may submit legislation to Parliament following consultations with relevant stakeholders, ministers announced on Sunday.

The proposal was disclosed during a press conference held at the President’s Office to announce Cabinet decisions made in connection with World No Tobacco Day.

Speaking at the briefing, Minister of Homeland Security and Technology Ali Ihusaan said the government increased cigarette duty in late 2024 following the ban on vaping products.

According to Ihusaan, the duty was raised from MVR 3.50 to MVR 8.00 based on studies and expert advice available at the time, amid concerns that former vape users could switch to conventional tobacco products.

“Changing duty rates is a tool used in other countries to prevent people who suddenly exit the vape market from switching to tobacco or using cigarettes,” Ihusaan said.

He noted that the government has consistently maintained that duty rates should be reviewed in line with available data and research.

Referring to a study conducted by the World Health Organisation, Ihusaan said one of the recommended duty rates for the Maldives in 2026 was MVR 4.00.

“Based on the research available to us right now, specifically a study conducted by the WHO, one of the duty rates recommended for the Maldives for the year 2026 is MVR 4.00. This is a rate we are currently considering,” he said.

A reduction from MVR 8.00 to MVR 4.00 would represent a 50 per cent decrease in the current duty rate.

Ihusaan said the government would hold discussions with relevant authorities and stakeholders before making a final decision.

“We will hold discussions with the relevant authorities and all stakeholders involved in making this decision. Following these consultations, if we agree to move to that rate, the government will submit that recommendation to the People’s Majlis,” he said.

The minister added that any changes would be based on assessments of market demand, consumption patterns and advice from technical experts, including recommendations from international organisations.

During the same press conference, ministers also announced plans to launch a national anti-tobacco campaign.