Southeast Asia: Effective tobacco tax policies could have saved 1.3 million lives

A report by the Southeast Asia Tobacco Control Alliance (SEATCA)[1] demonstrates the extent of human and fiscal losses in several ASEAN countries due to the failure to effectively implement best practices in tobacco taxation.

Since 2015, SEATCA has published a biannual Tobacco Tax Index report that identifies and tracks progress and gaps in the implementation of tobacco tax policies in ASEAN countries.[2] concerning Article 6 of the WHO Framework Convention on Tobacco Control (CCLAT)[3].

According to the 2021 edition of the report, five Southeast Asian countries (Cambodia, Indonesia, Laos, Myanmar and Vietnam) could have prevented more than 1.3 million premature deaths from tobacco use and collected more than US$4.81 billion in tax revenue if they had implemented effective tobacco tax measures.[4].

Tax policies hampered by the pandemic and industry interference

The report shows that while some countries in the region (Thailand and the Philippines) have made significant progress in recent years in implementing tobacco tax policies in accordance with Article 6 guidelines, the region as a whole is progressing very slowly. Most countries lack a long-term vision for tobacco tax policy and, as a result, do not regularly evaluate or update it. Moreover, those countries that have complex tax administrations and structures in this area are victims of significant interference from the tobacco industry in their policy formulation.[5].

As a result, most of these countries are foregoing significant tax revenues while paying the heavy price of their populations' tobacco consumption. The COVID-19 pandemic has only exacerbated this situation, with many governments remaining hesitant about raising taxes, including on tobacco, even though the sector has thrived during the health crisis. For example, British American Tobacco increased its profits by 10% in 2020.

Tax revenues necessary for the development of these countries

Proper implementation of Article 6 of the FCTC contributes to the achievement of the sustainable development goals (SDGs), including SDG 3 (good health and well-being with target 3.4: a one-third reduction in premature mortality from non-communicable diseases by 2030), SDG 1 (poverty reduction), SDG 10 (reduced inequalities), and SDG 8 (economic growth). Revenues from tobacco taxes could guarantee more income for governments struggling to cover the costs related to this pandemic, but would also ease the pressure on already fragile health systems. These revenues would also serve as a sustainable source of financing for prevention and health policies and programs. Several ASEAN countries have already established robust health promotion or tobacco control funds, such as the Thai Health Promotion Foundation (Thailand), the Malaysian Health Promotion Board (Malaysia), and the Vietnam Tobacco Control Fund (VNTCF).[6].

Record smoking prevalence in some countries

Analysis of cigarette prices in these ASEAN countries showed that cigarettes became increasingly affordable between 1999 and 2019. As a result, some countries are experiencing record prevalence. The ASEAN region has 122 million adult smokers (10% of global smokers). In this region, tobacco causes more than half a million deaths each year.

Indonesia, with 65 million smokers (67% of the adult male population smokes), represents 50% of ASEAN smokers. Tobacco is responsible for 266,000 deaths each year, including approximately 45,000 due to exposure to secondhand smoke.[7]Indonesia is one of the last countries not to have ratified the FCTC and its permissive legislation makes it a playground for the tobacco industry which has a free hand to interfere in the country's public policies but also to exercise its aggressive marketing strategies, particularly towards young people.[8]. Also, nearly one in five young people aged 13 to 15 consumes tobacco (36% of boys and 3.5% of girls).

Keywords: Asia, ASEAN, Southeast Asia, Tobacco, taxation, taxes, Indonesia ©Generation Without Tobacco

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[1] Ross, H. (2021). Lost Funds: A Study on the Tobacco Tax Revenue Gap in selected ASEAN countries. Southeast Asia Tobacco Control Alliance. Bangkok. Thailand. [2] The Association of Southeast Asian Nations is a political, economic and cultural organization of ten Southeast Asian countries. [3] SEATCA, Tobacco Tax [4] Press release, Cambodia, Indonesia, Myanmar, and Vietnam could have collected USD 4.81 billion in tax revenue with more effective tobacco tax measures, SEATCA, July 23, 2021, accessed July 26, 2021 [5] Tobacco Industry Interference in Tobacco Tax Policies in ASEAN Countries, SEATCA, accessed July 26, 2021 [6] Southeast Asia Tobacco Control Alliance. (2021). SEATCA Tobacco Tax Index: Implementation of WHO Framework Convention on Tobacco Control Article 6 in ASEAN Countries, 2021. Bangkok. Thailand. [7] The Toll of Tobacco in Indonesia, Campaign for Tobacco-Free Kids, last updated August 5, 2020, accessed July 26, 2021 [8] Tobacco Free Generation, When the tobacco industry has a free hand: the Indonesian case, published March 11, 2020, accessed July 26, 2021 National Committee Against Smoking |