Promoting Health Through Tobacco Taxation
Authors: Mohammed K. Ali
Journal: JAMA (2010)

TAXING TOBACCO HAS BEEN A LONG-STANDING CONtributor to government revenues. Tobacco excise taxes were first proposed by Alexander Hamilton in 1794 but not effectively implemented until the 1860s. By 1880, tax on tobacco accounted for 31% of total federal tax receipts. In addition to revenue generation, tobacco taxation has proved an effective policy measure to reduce tobacco consumption in many countries (eg, the United States, Australia, the United Kingdom, South Africa). In 2010, in the context of world leaders (especially in Japan, China, and the United States) contemplating or enacting legislation regarding excise tax increases on tobacco products, it is important to consider the broader determinants of promoting health through taxation. As a result of the fairly rapid effects of tax increases, most tobacco control leaders consider this approach an independently effective intervention. Even though tax increases are effective and desirable, sustained success in tobacco control requires multifaceted efforts. Instituting and maintaining policy interventions, such as increasing tobacco taxes, require a receptive population and willing legislators, and such policy measures are futile without enforcement. These are important considerations as tobacco control efforts are increasingly being directed toward lowand middleincome countries. Implementing effective tobacco taxation is limited by factors that vary between countries and cultures. These include but are not limited to consumer disposable income; availability of less-taxed tobacco products (eg, bidis in India); counterfeit, smuggled, and low-cost tobacco products; cross-border sales; conflicts of interest for policy makers (particularly in countries with a tobacco industry) between generating revenue and protecting the health of citizens; and the addictiveness of tobacco products. Taxation must be adequately instituted such that all tobacco products are taxed. Taxes should also be sufficiently high and regularly increased such that the retail price passed on to consumers is adequately burdensome to discourage tobacco use. If the costs of increased tobacco taxes are not passed on to the consumer at the point of purchase, then tax increases are ineffective. This scenario is apparent in China, where tobacco manufacturers and tax collectors deposit revenues in the same coffer. Nonprice regulatory and informational measures enhance the effectiveness of taxation as a public health intervention. Tobacco use is motivated and maintained by lack of awareness of risks; biological, psychological, and social elements; and industry marketing and promotion. A set of policy measures that empower individuals to make informed choices about tobacco use and discourage such use in public places and among youngsters may therefore counter the determinants of tobacco use that taxation alone cannot influence. Dissemination of information, such as publicizing the initial influential scientific reports that identified the harmful effects of tobacco, resulted in immediate 4% to 9% reductions in smoking prevalence in high-income countries. Smoking trends over the past half century further suggest alignment between levels of news media coverage of tobacco and health and rates of smoking cessation, accentuating the importance of consistent advocacy and propagation of the public health message. For example, highly publicized litigation against the tobacco industry in the United States in the 1990s served to reinforce the effects of waning awareness levels. Warnings on tobacco product packaging seek to have similar consistent, graphic educational value. Smoke-free environments have been shown to be effective in reducing exposure to smoke and even increased cessation among smokers in high-income countries. Empowerment of nonsmokers remains the mainstay of instituting and sustaining smoke-free environments. Recognizing this, the World Health Organization (WHO) advocates preparing businesses and the public through educational campaigns before smoke-free regulations are used. Comprehensive bans on tobacco advertising and promotion, and even counter-advertising, seek to diminish the widespread acceptability of tobacco in society and have been shown to independently reduce demand for tobacco products. The WHO Monitoring Trends in Cardiovascular Diseases (MONICA) project showed that reductions in to-