50% hike in cigarette rates would avoid 40 lakh deaths in India

Nov 14 2012, 22:01 IST
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For India, 50% rise in cigarette prices corresponds to increase of 70-122% rise in tax increase. (Reuters) For India, 50% rise in cigarette prices corresponds to increase of 70-122% rise in tax increase. (Reuters)
SummaryFor India, 50% rise in cigarette prices corresponds to increase of 70-122% rise in tax increase.

Increasing cigarette prices by 50 per cent would help avoid over 40 lakh tobacco related deaths in India, said a report released by multilateral funding agency Asian Development Bank (ADB).

"A 50 per cent price increase in cigarettes avoids about 27 million (or 2.70 crore) tobacco-attributable deaths, most of which are in the two most populous countries in the world. China would avoids nearly 20 million tobacco deaths, and India over 4 million tobacco deaths," said the report.

For India, it said, the 50 per cent rise in cigarette prices corresponds to increase of 70-122 per cent rise in tax increase.

As per the report, China, India, Philippines, Thailand and Vietnam in Asia are among the top five of the 15 tobacco using countries that account for two-third of the world tobacco consumption.

For each of the five most tobacco consuming countries in Asia, "increasing taxes on cigarettes would result in substantially fewer long-term smokers and a reduction in premature deaths from tobacco-related diseases, while increasing tax revenues."

In India, the report said that bidi is the most common type of smoked tobacco. It remains largely untaxed and their taxation strategies differ from the established patterns of taxation of cigarettes, which are administratively easier to tax than are bidis or other types of tobacco.

"Moreover, cigarette smoking is steadily displacing bidi smoking in India. Thus, it makes sense for governments to focus on taxation strategies for cigarettes while expanding efforts to tax tobacco products more broadly," it said.

The poorest socioeconomic groups in each country bear only a relatively small part of the extra tax burdens, but reap a substantial proportion of the health benefits of reduced smoking.

The ratio of health benefits accrued to the poor to the extra taxes borne by the poor ranges from 1.4 to 9.5.

"Thus, large increases in the cigarette tax in all of these countries are unusually attractive for public health and public finance, and are pro-poor in their health benefits."

The report further said that Indian male smokers can expect to lose a full decade of life and most lives are lost are at the most productive age of 30-69 years, rather than advanced age.

As per its estimates there are 4.45 crore male while 32.6 lakh females smokers in the country.

"In India, the low SES (socioeconomic status) group would account for 30 per cent of marginal taxes paid, but 47 per cent of smoking deaths averted," it said.

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