- DAY: Thursday, June 17th 2021
- TIME: 11:00 am EDT [check Here for your time zone]
- DURATION: 120 minutes
Tobacco taxes are the most cost-effective tobacco control measure. Tobacco use generates a significant economic burden for the entire society and leads to significant negative externalities, including high healthcare costs and lost productivity due to tobacco-attributable diseases. Taxes not only limit these externalities by reducing consumption and prevalence, but also help cover public health spending related to tobacco use and exposure to tobacco smoke.
The ability of tobacco tax increases to achieve higher tax revenue - while reducing tobacco use - depends on the price elasticity of demand. In the case of cigarettes, this elasticity is relatively “inelastic,” that is, the percentage change in demand is less than the percentage change in price. Studies carried out in the Latin American region show that an increase in taxes produces an increase in tax collection and decreases consumption, throughout the Region.
In 2015, when the Addis Ababa Action Agenda of the Third International Conference on Financing for Development was adopted, raising tobacco taxes was included as a tool to increase tax collection in developing countries, as a way to mobilize its own national resources to finance the Sustainable Development Goals.
Despite all this information, the pricing and tax policy is one of the least applied tobacco control policies at the highest level of compliance by countries, both in our region and in the world. Most countries are not taxing cigarettes effectively. In part this is because it does not depend on the Ministries of Health, and in part because there is a very well organized campaign, at the international level, by the tobacco industry and its allies, to systematically oppose these taxes.
Tobacco taxes are of the greatest relevance, both because it is a risk factor for the four main non-communicable diseases (NCDs), which are at the base of the severity of the pandemic, and because of the fact that smokers in themselves are more likely to develop severe symptoms if they have COVID-19. Tobacco taxes represent a triple win for governments by improving health, reducing associated healthcare costs, and increasing tax collection. Furthermore, in the current context, the additional revenue could be used to respond to the pandemic or finance economic recovery and reduce fiscal deficits. In this sense, it is crucial to advance between a coherence between fiscal and public health policies on excise taxes on tobacco products.
About Webinar 2
Objectives of the session:
- Provide economic arguments to achieve coherence between fiscal and public health policies on excise taxes on tobacco products, discussing their use in the context of the COVID-19 pandemic.
- Present best practices in the use and administration of excise taxes on tobacco products
- Present data and novel evidence in the region on tobacco taxes
- Share experiences between countries in the use of tobacco taxes
- Member States government officials involved in the design, monitoring, and evaluation of tobacco tax policies from Ministries of Finance, Economy, Trade, or Tax Administration and Customs agencies.
- FCTC focal points from the Ministries of Health, Foreign Affairs, and other government officials involved in tobacco control.
- Economists (civil society and academia) and activists working on tobacco control in the Region of the Americas.
Important resources for the session:
- IARC. Effectiveness of Tax and Price Policies for Tobacco Control. IARC Handbooks of Cancer Prevention Volume 14. 2011 (English only). https://publications.iarc.fr/Book-And-Report-Series/Iarc-Handbooks-Of-Cancer-Prevention/Effectiveness-Of-Tax-And-Price-Policies-For-Tobacco-Control-2011
- OPS. Manual técnico de la OMS sobre Administración de Impuestos al Tabaco. 2015 (Spanish only) https://www.paho.org/es/documentos/manual-tecnico-oms-sobre-administracion-impuestos-al-tabaco
- Tobacconomics. Cigarette Tax Scorecard. 2021 https://tobacconomics.org/files/research/636/uic-tobacco-scorecard-report-eng-v7.1.pdf