Sin taxes hailed by int’l commission as “most important” tool for stemming global NCD epidemic

Press Release— Action for Economic Reforms— 9 December 2013

An international group of economists and public health experts commissioned by the Lancet— the world’s leading general medical journal— have released a new research report that proposes a comprehensive, pro-poor investment plan for attaining dramatic global health gains by 2035.

Titled Global Health 2035: A World Converging within a Generation, one of the main conclusions of the Lancet Commission’s report is that “the single most important opportunity for national governments worldwide to curb NCD’s is to tax tobacco heavily.”

Other significant findings by the 25-member commission, chaired by former World Bank Chief Economist Lawrence Summers and professor emeritus Dean Jamison of the University of Washington, are that:

  • Due to global demographic shifts since the 1990’s, tobacco-related non-communicable diseases (NCD’s), together with injuries, are now the leading causes of death in most nations, including lower and middle-income countries
  • Fiscal policies, especially excise taxes on tobacco products, remain a powerful, yet underused lever for curbing NCD’s while raising revenues for further public investment in health
  • Firm international action remains needed for monitoring and implementing the WHO Framework Convention on Tobacco Control, and in ending tobacco smuggling
  • Publicly-financed universal health insurance and the progressive expansion of healthcare coverage are both an efficient way to tackle growing numbers of NCD’s and injuries while benefitting the poor the most, who are disproportionately affected by these problems

“Action for Economic Reforms as well as our other partners in the sin tax reform advocacy are elated by the report of the Lancet Commission,” said Jo-ann Latuja, AER senior economist. “The Commission’s findings confirm that the Philippines is indeed on the right track towards curbing NCD’s and improving the health of the poor, having passed the sin tax law in 2012.”

“The Lancet report comes at a time when the Philippines will be marking the first year of implementation of the sin tax law, which brought about deep reforms in our tobacco excise tax scheme, including higher tax rates. The Philippines has shown the way in how excise tax revenues can be greatly enhanced, even while significantly reducing demand for tobacco and smoking prevalence,” she asserted.

Based on the latest DOF figures, excise tax collections for tobacco and alcohol products for the first to third quarters of 2013 have climbed 64 percent above their 2012 levels. During that same time period, cigarette volume removals reportedly dropped by 27.5 percent.

Similarly, according to a market survey conducted by Nielsen in the first half of 2013, smoking prevalence in the country decreased from 52 to 46 percent with the implementation of the sin tax law.

“When prices of cigarettes are raised further next year and the year after that, there is no doubt that these gains will only further increase,” Latuja added

R.A. 10351, more popularly known as the Sin Tax Reform Act, was signed by President Noynoy Aquino last December 20, 2012, after being stalled at the committee level in the Senate and House of Representatives for more than 15 years.

The measure has been dubbed by current Senate President Franklin Drilon as “the single most important health policy legislation of the past decade.”

 

Full Lancet Commission Report available at: http://download.thelancet.com/pdfs/journals/lancet/PIIS0140673613621054.pdf?id=8b69abadd6dadf97:4d51d508:142b742f1ef:-b3f1386057387625

Lancet Commission on Health Investment website: http://www.investinginhealth2035.org/global-health-2035-world-converging-within-generation

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