[Intl-tobacco] WHO: Tobacco taxes still not high enough to save lives

[Robert Weissman]

Tobacco taxes still not high enough to save lives, says WHO

27 February 2002

Tobacco products in developing countries are cheaper now than they were a
decade ago—sometimes even cheaper than bread or rice—said the World Health
Organization (WHO) today. The organization says lower tobacco product prices
have grave consequences in countries which could soon see the greatest
number of tobacco-related diseases and deaths.have grave consequences.

A new study by WHO looking at tobacco price trends between 1990 and 2000 in
over 80 countries indicates that, in for the most part, cigarettes have
become more expensive in most developed countries and are more affordable
than ever in many developing countries. Over 70% of the 8.4 million tobacco
deaths that are estimated to occur in projected to occur in 2020 will occur
in developing countries. WHO warns that cheaper tobacco products would will
only fuel the tobacco epidemic further—leading to more consumption, disease
and death in the future.

Developing countries where tobacco control programmes are not yet
comprehensive and where prices have decreased in last decade can be
found in
every continent and include Viet Nam, Costa Rica, and Côte d'Ivoire.
Cigarette prices tend to be higher in wealthier countries places and where
strong tobacco control programmes exist such as Norway, Australia and Hong
Kong, China. However, in countries where the household incomes are high but
tobacco control programmes are lowlacking, such as Japan and Switzerland,
tobacco prices remain low.

In spite of overwhelming support for from past studies conducted by the WHO,
the World Bank, the International Monetary Fund and leading economists for
increases ina tobacco taxes,  increase from past studies conducted by the
WHO, the World Bank, the International Monetary Fund and leading
economiststhis new evidence shows that the price of tobacco products have
not kept pace with inflation and are now more affordable than ever.

“Increasing the price of tobacco products remains one of the most effective
methods of curbing the consumption of tobacco products and thereby reducing
the global deaths caused by tobacco,” said Dr Derek Yach, Executive Director
of Noncommunicable Diseases and Mental Health, WHO. “Higher prices may
assist non-users in continuing to keep away from tobacco and thus avoid
addiction. It can also induce current smokers to consume less tobacco or
even persuade them to quit, or prevent ex-users from starting again.
Governments receive more revenue from increased taxation. It’s a win-win
situation,” added Dr Yach, who is also co-author of the new study that is
soon to be published in the journal Tobacco Control.

The study shows there is plenty of room to increase tobacco taxes in
developing countries, making it one of the most significant policy tools
available to governments trying to save their people—as well as health
systems and economies—from the onslaught of tobacco. According to the World
Bank, a price increase of 10% can reduce demand for tobacco products by
about 4% in high-income countries and by about 8% in low-and middle-income
countries. The Bank estimates that tax increases that would raise the real
price of cigarettes by 10% worldwide would cause about 42 million
smokers to
quit and prevent a minimum of 10 million tobacco-related deaths.

The tobacco industry realizses the implications that higher taxes would have
on their sales volume. Secret industry documents obtained in US litigation,
from Philip Morris and British American Tobacco, express well the industry’s
concerns:

“Of all the concerns, there is one – taxation – that alarms us the most.
While marketing restrictions and public  and passive smoking do depress
volume, in our experience taxation depresses it much more severely.  Our
concern for taxation is, therefore, central to our thinking about smoking
and health,” reveals one Philip Morris International’s document.

“Increases in taxation, which reduce consumption, may mean the destruction
of the vitality of the tobacco industry,” said BAT in a 1992 internal
document.

It is therefore not surprising that the tobacco industry vehemently opposes
increases in tobacco taxes and does everything it can to prevent governments
from increasing taxes.  WHO calls on governments not to be deflected from
their primary mission to protect public health and to resist industry
pressure in taxation and other measures that will help save lives.

WHO also recommends earmarking a portion of government revenues gained from
tobacco taxes to fund tobacco control activities such as cessation
programmes, counter-advertising or cancer research. Many countries such as
Australia, Thailand, Egypt, Iran and several US states such as California
already do so. Additional countries such as the UK, Saudi Arabia, and Qatar
have indicated their intention to earmark a portion of tobacco taxes to fund
tobacco control activities.

Additional recommendations made by WHO include:  regional cooperation to
harmonize tobacco prices, which cuts down the incentive to smuggle;
government actions to adjust cigarette prices with increases in the Consumer
Price Index so that it they keeps up with inflation;  and a strong push for
strong price and tax measures in on-going negotiations for a Framework
Convention on Tobacco Control.

The new study can be found in the journal Tobacco Control 2002 Volume 11
Number 1, available at: www.tobaccocontrol.com


For more information, contact Reshma Prakash at 0041 22 791 3443, fax 0041
22 791 4832, prakashr@who.int. For more information on tobacco please visit:
http://tobacco.who.int