Taxing tobacco should be a key element of worldwide efforts to finance the new Sustainable Development Goals (SDGs), according to recommendations made to United Nations member states in the outcome document recently negotiated in New York.
The Financing for Development (Ffd) conference in Addis Ababa from July 13-16 will consider a document recognising the importance of tobacco levies, which the Secretariat of the World Health Organization’s Framework Convention on Tobacco Control and its partners have been seeking.
“The fight against tobacco will only be won if there is adequate financing and tobacco tax provides a key element,” says Dr Vera Luiza da Costa e Silva, Head of the Convention Secretariat. “Member States will take a huge step in tackling tobacco-related illness and towards financing the post-2015 development agenda.”
The Sustainable Development Goals will be finalised at the UN High Level Summit on in New York from 25-27 September. The FCTC Secretariat is also working to ensure that the anti-tobacco campaign forms part of this critical agreement, which will set the development agenda up to 2030.
The importance of tobacco taxation has been underscored by considerable research. It’s estimated that a tripling of excise tax on tobacco in most low- and middle-income countries would double cigarette prices, reducing consumption by about 40%. This reduction would be greater among young people and the poor who are most sensitive to changes in price.
As public health improves over time as a result of higher tobacco prices and tax revenues, the economic consequences of tobacco use lessen. Health services benefit as the burden of tobacco-related disease declines, while economic output rises as citizens live healthier lives.
The results are clear from the Philippines, which adopted a radical Sin Tax in 2013. This increased tobacco excise duties by as much as 340 percent, raising the equivalent of US $1.6 billion in its first year. Some of the money was used to subsidise health insurance subsidies for 14.7 million poorer people, almost triple the previous year’s figure.