HEALTH: Higher Taxes Could Loosen Tobacco’s Hold on Poor Countries

By Marwaan Macan-Markar Reprint | | Print |

Marwaan Macan-Markar

CHICAGO, Aug 9 2000 (IPS) - p How do you stop the developing world from succumbing to the lure of smoking? Tax smokers there into quitting. That, in essence, is the World Health Organisation’s (WHO) and the World Bank’s prescription for the malady stalking developing countries.

In a new report released here this week the WHO and the World Bank say imposing higher taxes on cigarette sales would result in immediate benefits. A 10 percent hike in cigarette prices as a result of a tax increase, the report predicts, would force about 42 million people to quit smoking.

Furthermore, raising cigarette taxes “could prevent about 10 million tobacco-related deaths,” nine million of which occur in low-and middle-income countries.

For Prabhat Jha, an editor of the 512-page report “Tobacco Control in Developing Countries,”, the argument for higher taxes provides Third World countries with a “win-win” situation. “Not only will tobacco consumption and tobacco deaths drop, but government tobacco revenues will actually rise by seven percent on average for a 10 percent increase in cigarette taxes.”

Dr. Gro Harlem Brundtland, the WHO director-general agrees. “Moderate action, such as higher tobacco taxes, could ensure tremendous health gains. Governments wishing to halt the rising toll of tobacco-related deaths should strongly consider increases in tobacco taxes as a matter of priority.”

Currently, the report reveals, taxes on cigarettes are much higher in the developed world than in developing countries. While nations like France, Germany and Austria have taxes above 70 percent on cigarettes, poorer states such as Bangladesh, Indonesia and Zambia only levy a 30 percent tax.

The need for such blunt measures to curb smoking in developing countries comes as tobacco manufacturers turn increasingly to Third World markets to offset dwindling sales in the developed nations.

This view, in fact, has emerged as one of the dominant features here at the week-long 11th World Conference on Tobacco Or Health, which began on Sunday night (Aug. 6).

Today, close to 250 million Indian men smoke, a number that equals the population of the United States, said Chittakkudam Soman, an Indian health activist, who is among the 4,500 participants from 140 countries at this gathering.

In Indonesia, there is growing concern over how rapidly university students are falling into the clutches of aggressive tobacco marketing. “A study done in 1999 with university students from Universitas Muhammadiya found that 39.4 percent of 241 students (surveyed) are smokers,” revealed Soeratmi Poerbonegoro of the University of Indonesia.

For the conference participants, who are determined to shape a global agenda to create a tobacco-free world, there were other dismal details about smoking in the developing world to contend with.

According to the WHO, if the current trend in smoking continues, there will be 1.6 billion smokers by 2025, as against the 1.1 billion smokers in the world today, with countries in the Asia- Pacific region accounting for the highest consumption rate.

Furthermore, by 2030 close to 70 percent of all deaths from tobacco will occur in the developing world, up from 50 percent today.

This would mean that tobacco “will soon become the leading cause of death worldwide, causing more deaths than HIV (human immunodeficiency virus), maternal mortality, automobile accidents, homicides and suicide combined.”

What will contribute to that, states the report, will be the reluctance among many males in low-and middle-income countries to kick their habit.

“While in most high-income countries, about 30 percent of men are former smokers, only two percent of men in China had quit in 1993 and only five percent of men in India, (while) in Vietnam, only 10 percent had given up smoking in 1997.”

In addition, observes the report, children will also be a part of the dismal scene, since the tobacco industry is targeting them specifically. “There is evidence that the tobacco industry targets children with glamorous advertisements and promotions.”

Often, it adds, children are drawn to cigarettes because of their affordability. “Compared with many consumer goods that may be desirable to children such as automobiles, cigarettes are generally affordable and accessible.”

For the authors of the report, a dramatic increase in taxes on tobacco is a potent way of shifting such a trend. This, they argue, stems from how much more sensitive young people would be to price changes.

Likewise, they add, such a blunt measure to curb the demand by adult smokers in the developing world will also result in them quitting, since the bulk of the smokers are from the poorer groups in the society. For such adults, in fact, the immediate benefits will be “significant” p accounting for “a proportionately larger increase in overall disposable income.”

And this prescription has worked before p in South Africa. According to Corne van Walbeek, of the University of Cape Town, the dramatic drop in cigarette smoking in that country was directly related to the price hike on tobacco stemming from taxes.

“The democratically elected government of 1994 implemented a rigorous tobacco control policy, including restrictions on smoking on public transport, health warnings, advertising bans, and a significantly increased tobacco excise rate. The result of these actions has been a significant decrease in cigarette consumption,” he observed.

Allan Rock, the Canadian Minister of Health, also sees merit in this push. “Taxes must be increased as much as possible as a deterrent against smoking,” he says.