The Ceylon Tobacco Company (CTC) has paid the government Rs. 68.6 billion as taxes, states its recently released annual financial report for the first 09 months of 2015. This is a growth of over 27 per cent that the CTC had paid the government during the first nine months of 2014.

The CTC has earned Rs. 8.8 billion as profit after tax during the first 09 months of 2015 and when compared to the profit after tax of Rs. 6.6 per cent during same period in 2014 it is a growth of 33.33 per cent.

On the other hand, while the CTC had earned a gross profit of Rs. 64 billion during the first nine months of 2014, it has earned a gross profit of Rs. 82.79 billion during the first nine months of 2015, which is a growth of 29per cent.

CTC points out to the growth of its consumers’ disposable income as the main reason during this period.

However, what this report confirms is that the smoking habit in Sri Lanka cannot be decreased by merely raising the prices of cigarettes. This is confirmed by the ever-prevalent positive link among the cigarette price increases, the CTC profits and the government’s tax revenue.

This financial report also confirms that increasing the price of cigarettes is no longer a viable factor in discouraging the smoking habit among the Sri Lankan public and that this is only a direct factor in the increase of the company’s profits and the government’s tax revenue. On the other hand, though CTC claims that the consumers’ disposable income has increased, it is yet to prove how this has happened.

Hence, it is clear that the government decision to increase the price of cigarettes is no longer a decision on the health related wellbeing of the people and that it is only a strategy to increase its tax revenue.