WHO calls for higher tobacco taxation

Too few governments levy appropriate levels of tax on cigarettes and other tobacco products.

They therefore miss out on a proven, low-cost measure to curb demand for tobacco, save lives and generate funds for stronger health services, according to the World Health Organisation’s Report on the Global Tobacco Epidemic-2015.

The report focusses on raising taxes on tobacco, which varies greatly from country to country. 
Although 33 countries impose taxes that represent more than 75 per cent of the retail price of a packet of cigarettes, many countries have extremely low tax rates, and some have no special tax on tobacco products at all, read the report.

In the UAE a 100 per cent tobacco tax applies, and a plan to double this rate is in the pipeline.

Health officials in the GCC have pointed to the low cost of tobacco in the region – with packs of 20 cigarettes at around Dh7 compared with costs of Dh48 in the UK – as one of the reasons for the raising tobacco tax to reduce smoking.

"Raising taxes on tobacco products is one of the most effective – and cost-effective – ways to reduce consumption of products that kill, while also generating substantial revenue," said Margaret Chan, WHO Director-General, "I encourage all governments to look at the evidence, not the industry's arguments, and adopt one of the best win-win policy options available for health."

However, critics claim that the move could fuel illicit trade in the region by gangs targeting young people, and lead to a growth in cigarette counterfeiting, impacting on local businesses.

Especially an overnight hike in prices could fuel the smuggling of tobacco products from countries where prices are lower, where the products are sold at significantly higher prices elsewhere.

Vera da Costa e Silva, Head of the WHO Framework Convention on Tobacco Control (WHO FCTC) Secretariat, notes that the Convention offers governments policies to curb illicit trade in tobacco products to reduce demand and boost tax revenues from tobacco sales.

"Countries should consider implementing the provisions of the Protocol to eliminate Illicit Trade in Tobacco Products to confront the illegal market," she added.

The proposal to hike taxation in the GCC countries was presented in a while paper last year and is currently under consideration.

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