Use tax policy tool to cut down tobacco use among youth

As it’s about protecting the lives of youth, we must use tax policy as a tool in the fight against tobacco consumption and its associated harms and increase revenue. The time is now and here.

Written by May 27, 2021 10:34

*During Covid-19 times, consumption of tobacco among younger age group should be cut by increasing taxes on tobacco-related products that would save lives as well help the government raise revenue

*Around 2.9 lakh people addicted to tobacco have succumbed in the last 14 months in India after getting infected with the deadly pathogen

tobacoo, pan masala -

The on-going second wave of the Covid-19 has massively hit Indian economy. On top of this predicament, excess use of tobacco has added additional risks to public health given the already overwhelmed health infrastructure in the country.

It is common knowledge by now that serious consequences of Covid-19 feature pneumonia and affects the lung function. So does tobacco consumption which is known to weaken the lung or immune system by creating excess mucus in the lung which stays in the airways, clogs them and leaves you coughing while making it perfect hotbed for various infections such as Coronavirus.

A recent survey has shown that around 2.9 lakh people have succumbed in the last 14 months in India as a result of tobacco use after they got infected with the deadly pathogen. Think of what this means not only in terms of loss of life but of potential and promise that they could have contributed to the country’s economy.

The tobacco Industry may have its interest in looking another way, the government can’t. It needs to play a protective role in saving the lungs of its vulnerable but precious youth. In fact, during my visits to college and schools when they were opened, I used to see many youths getting addicted to the tobacco—whether smoke or smokeless. After talking to many of them, I reached to the conclusion that, as long as they can afford it, the chances of them quitting it is quite unlikely.

Also, a teenager smoking by the roadside has been a common sight. It bleeds my heart to see that the industry is making profits at the cost of these innocent and impressionable minds. Various studies show that five and a half thousand teenagers in India are getting addicted to tobacco products daily, adding to the burden on the health system in the long run country.

For those who speak in support of the tobacco, citing a recent scientific paper claiming current smokers are 23 per cent less likely to be diagnosed with Covid-19 compared to non-smokers, I would like to tell them that the study has been retracted by the medical journal European Respiratory Journal, after it was discovered some of the paper’s authors had financial links to the tobacco industry.

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The WHO too has warned that because smoking impairs lung function, there is an increased risk of severe symptoms if respiratory infections, including coronaviruses, are acquired by smokers.

Needless to say, it has called for discouraging tobacco use to decrease the risk of spreading the pandemic since smokers are more likely to be seriously ill with Covid-19 than non-smokers. As per the global body, tobacco consumption costs the world a whooping USD 1.4 trillion annually from health expenditures and lost productivity. This warrants a robust tobacco policy as an effective strategy to promote public health and generate revenues to support governments as they work towards their sustainable development goals and build back better after the Covid-19 pandemic, says the WHO.

In this regard, the WHO makes it clear that the tobacco tax reform can help decrease tobacco consumption (along with associated death, disease, and costs); increase revenues and contribute to the financial sustainability of the Universal Health Coverage (UHC) system.  This is going to be a win-win situation for India too.

The WHO recommends that taxes constitute at least 75 per cent of the retail price of all tobacco products. I strongly feel that India should consider this benchmark to reduce the harm caused by tobacco to save its youth from the ills of tobacco. However, the average tax burden on smokeless tobacco products currently in India is about 64 per cent.

In fact, all tobacco products in India have become more affordable over the past ten years, and there has not been any major increase in tobacco taxes since the introduction of GST in July 2017, according to a study.

It points out that the GST has accentuated the increasing trend in the affordability of cigarettes, bidis and smokeless tobacco and in-fact did nothing to reduce the affordability of bidis. Data speaks. The annual economic cost from all tobacco products is estimated to be Rs 177.341 crores in 2017-18 amounting to 1 per cent of India’s GDP. This will continue to grow post-Covid era.

Experts also suggests that tobacco taxes are particularly effective among vulnerable populations such as youth and low-income smokers.  A 10 per cent price increase reduces tobacco consumption by 5 per cent in low- and middle-income countries.

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I too feel that applying compensation cess on the remaining sin products such as bidis and raising the existing compensation cess on cigarettes and smokeless tobacco products can be a very effective policy measures to address the immediate need to raise the compensation cess revenue by the central government.

It is urgent to increase taxes on all tobacco products, and especially on bidis which are the most consumed and the cheapest tobacco product, not only to reduce their affordability and therefore consumption, but also to limit the increasing health and fatal damages caused by tobacco.

For, affordability that leads much younger age groups to start smoking could be cut by increasing taxes on tobacco-related products. I agree with experts in the sector who have also suggested that, as an extraordinary measure, the GST Council should apply the compensation cess on bidis like other sin goods such as cigarettes and smokeless tobacco products, and also increase the existing compensation cess applied on cigarettes and smokeless tobacco products so that the total tax burden reaches 75 per cent of their retail price.

However, I would like to re-assert that the government must remember that whatever the amount of the revenue is, tobacco use cannot be justified, for, it has massive and deadly consequences, which include fatal to human life, work day loss to the person sick due to tobacco induced-deadly diseases and risk of Covid-19.

As it’s about protecting the lives of youth, we must use tax policy as a tool in the fight against tobacco consumption and its associated harms and increase revenue. The time is now and here.

 (The writer is a  youth leader and spokesperson of Maharashtra BJP. She works in the field of CSR and rural transformation. Views expressed are personal)


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