Local NGO director renews calls to increase tobacco taxes in Kingdom

Local NGO director renews calls to increase tobacco taxes in Kingdom

Cambodia Movement for Health (CMH) executive director Mom Kong has renewed his requests to the government that the taxes on tobacco be raised to generate more income for the national budget and reduce the overall number of cigarette smokers.

Kong’s NGO held a two-day workshop on “effective tax measures” on October 6-7 in Kampong Chhnang province.

He said that a tobacco tax raise will make generate more income for the government and it is an effective measure that encourages people to reduce smoking cigarettes or quit them entirely.

He noted that a study released by the UNDP in 2020 showed that Cambodia’s cigarette taxes were still among the lowest in ASEAN and far lower than the levels recommended by the World Health Organization (WHO).

The study found that currently the tobacco tax rate in Cambodia is between 25 per cent and 31 per cent of the retail price, which is very low compared to the tobacco tax rates of some other ASEAN countries such as Indonesia, Malaysia, Brunei, Singapore, Philippines, Thailand and Myanmar. Tobacco taxes in those countries are more than 50 per cent of the retail prices at minimum.

The UNDP said that the tobacco tax raise will provide the highest return on investment among the priority tobacco control measures and that for an investment of one riel, Cambodia can get back 882 riel as an economic benefit over 15 years.

UNDP added that raising taxes and implementing tax structure reforms according to the roadmap for Cambodia’s tobacco taxes would generate additional tax revenues of 920 billion riel in the first five years and the Kingdom could use this extra income to finance measures to support the poor, such as offering universal health coverage, as well as helping tobacco farmers switch to other crops or other occupations.

The CMH executive director cleared up some confusion caused by what he said are the arguments made by tobacco lobbyists, saying that raising tobacco taxes would not lead to a loss of state tax revenues, affect jobs or the livelihoods of the poor or lead to tax evasion, but the tax raise would actually help the people instead.

“When tobacco taxes are raised, people who are less able to afford it will be forced to reduce smoking or quit smoking themselves like what happened in the Philippines and Thailand. The majority of people of those countries today have quit smoking cigarettes and the government received added revenues from the taxes on tobacco. The governments of those countries use money from the taxes to support public health promotion activities,” he said.

UNDP said that raising the cigarette tax would be most effective as a global policy and that it would help to prevent and reduce poverty, improve people’s health and well-being, reduce social inequality and promote economic development, which accelerates the country’s development process towards achieving sustainable development goals (SDG).

UNDP recommended that the government scale up tobacco taxes to at least 75 percent of the retail price, with periodic increases to outpace inflation and income growth and governments should allocate part of the tobacco tax revenues to tobacco control and pro-poor measures, such as universal health coverage, supporting tobacco farmers and workers to switch to alternative livelihoods, and other social protection schemes.

UNDP also suggested that governments raise awareness among the public and policymakers about the true costs of tobacco and the enormous health and development benefits of tobacco control, particularly among lower-income people. The government must also ensure all relevant sectors are engaged in comprehensive, effective, and sustainable tobacco control efforts, while protecting policymaking from tobacco industry interference.

In Cambodia, according to a survey, Kong said that 94 per cent of Cambodians supported an increase in tobacco taxes because raising tobacco taxes is a measure that benefits the national economy and its people.

According to a study by the UNDP and the WHO, tobacco kills an estimated eight million people globally each year and 15,000 of those deaths occur in Cambodia yearly. Tobacco use, especially smoking cigarettes or cigars, causes coronary heart disease, lung cancer, diabetes, high blood pressure and other related diseases.

Source: The Phnom Penh Post