• Tax revenue rises by Rs 21.7 b to Rs 102.7 b
• Govt moves to tighten tobacco tax administration

Annual cigarette consumption in Sri Lanka declined by 53.1 per cent between 2015 and 2025, falling from approximately 4.1 billion sticks to 1.923 billion sticks, while Government revenue from Excise duty on cigarettes and tobacco increased from Rs 81 billion to Rs 102.7 billion during the same period, Deputy Finance Minister Dr. Anil Jayantha Fernando said.

Responding to a question raised by Opposition Parliamentarian Ravi Karunanayake, he said the decline in cigarette consumption demonstrated the effectiveness of tobacco taxation as a policy tool to discourage smoking while generating revenue for the State.

He noted that total revenue collected from tobacco-related taxes, including indirect taxes and the Health Promotion Levy (co-pay), amounted to Rs 157 billion in 2025.

Dr. Fernando said the Government recognised the significant economic and healthcare burden caused by tobacco use, although no single official estimate of its total cost had been adopted due to differences in methodologies and assumptions used in available studies.

Referring to existing research, he said the Global Adult Tobacco Survey Sri Lanka 2020, published by the Health Ministry, estimated that 24,461 deaths in 2019 were attributable to smoking. Meanwhile, the Annual Trend Survey on Tobacco Use in Sri Lanka 2024, published by the Alcohol and Drug Information Centre, estimated that approximately 18,250 smoking-related deaths occur annually.

He added that the Government was continuing efforts to strengthen tobacco control measures.

“For instance, amendments to the Tobacco Tax Act are currently being drafted with the objective of strengthening tax administration and improving compliance. That is currently with the Legal Draftsman,” he said.