Tobacco prices: industry lobbying in Southeast Asia

In its latest report, the Southeast Asia Tobacco Control Alliance (SEATCA) analyses the tobacco industry's influence strategies on tax issues in seven Asian countries (Cambodia, Indonesia, Laos, Myanmar, the Philippines, Thailand and Vietnam). As elsewhere, the tobacco industry seeks to dissuade governments from implementing strong tax policies on tobacco products, in particular by disseminating claims that are invalidated by scientific research[1].

Different lobbying methods to prevent a measure recognized as effective

The report notes attempts by the tobacco industry to interfere in tax policy. While Article 6 of the World Health Organization Framework Convention on Tobacco Control (FCTC) recognizes tax increases as an effective tool to reduce smoking prevalence, manufacturers are deploying lobbying strategies to prevent the implementation of such a public health measure. Here, manufacturers' interference in taxes can take different forms, such as mobilizing front groups to defend their interests, funding and sponsoring research aimed at producing a biased scientific discourse intended to influence public decision-making, or the recurring presence of tobacco industry representatives in the media. These forms of influence, also observed in other countries, demonstrate the ability of these manufacturers to deploy an interference strategy on an international scale.

Negative economic and social consequences associated with taxes

The tobacco industry’s interference in taxation is also reflected in a discursive strategy aimed at dissuading governments from taxing its products. In particular, the argument most often used by the tobacco industry in these countries is that tax increases on tobacco products encourage illicit trade, and in particular tobacco smuggling. Then, manufacturers claim that high taxation has negative economic consequences, particularly for tobacco farmers, and that it weakens investment. Here again, these arguments echo the tobacco industry’s discursive strategy in other countries, while their validity has been contested by independent scientific literature. However, the report notes that since Covid-19, the tobacco industry has more regularly used the argument that tobacco taxes are holding back the country’s growth.

Tobacco industry still seen in some Southeast Asian countries as legitimate tax partner

The report also points out that in three of the countries studied (Indonesia, Myanmar and Vietnam), officials within ministries meet with the tobacco industry and its representatives to discuss the taxation of its products. Such meetings show that for some public decision-makers, tobacco manufacturers remain legitimate interlocutors, normalizing both their sector and their capacity for influence. Furthermore, both Myanmar and Vietnam ratified the WHO Framework Convention in 2004, effectively obliging them to ensure that their public policies are not influenced by the interests of the tobacco industry, recognized by the treaty as irreconcilable with the general interest. For its part, Indonesia is one of the few countries in the world not to have ratified the FCTC.

Front groups to advance tobacco industry interests in Southeast Asia

In all the countries studied, opposition to tax increases on tobacco products is provided by a number of front groups, such as economic and commercial groups (hotels, cafes, restaurant associations), researchers and experts (lawyers, academics, economists, etc.), organizations linked to public authorities (local decision-makers in tobacco leaf growing regions), or groups associated with the tobacco industry (growers, tobacconists' organizations).

Seatca recommendations

The report, however, highlights that in each country, strategies have been put in place with the aim of counteracting the influence of the tobacco industry. In particular, this fight against influence involves organizing workshops and debates with public decision-makers to raise their awareness of the issue of interference by cigarette manufacturers. The Seatca report develops a number of measures and guidelines aimed at curbing the influence of cigarette manufacturers on tobacco tax policies, including:

- Take into account Article 6 and the guidelines of Article 5.3 of the WHO FCTC when developing tobacco tax policies;

- Regularly strengthen the knowledge of public decision-makers, particularly at government level, not linked to health, in order to understand the importance of tobacco tax policies;

- Apply transparency obligations in the relationships that officials may have when interacting with the tobacco industry;

- Establish systems to monitor tobacco industry interference;

- Seek technical advice from specialist institutions/organisations that have no conflict of interest with the tobacco industry.

- Collect and analyse key data, including those relating to tobacco tax revenues and illicit trade in tobacco products.

- Strengthen legislative and other measures aimed at reducing the illicit tobacco trade, and ensure that sufficient human, financial and technical resources are devoted to this, in complete independence from the tobacco industry.

FT

[1] SEATCA, Tobacco Industry Interference in Tobacco Tax Policy in ASEAN Countries, 11/2022, (accessed 02/15/2023)