Smoking drops as high tobacco taxes take effect

Smoking drops as high tobacco taxes take effect

Smoking among Rwandans has reduced, mainly due to high tobacco taxes and prices, Minister of State in the Ministry of Health, Dr Yvan Butera, told lawmakers. This was during a plenary session of the Lower House, held on February 20, 2023, which adopted the law approving Rwanda’s accession to the Protocol to Eliminate Illicit Trade in Tobacco Products.

The protocol was adopted by consensus at the fifth session of the Conference of the Parties (COP) to the World Health Organization (WHO) Framework Convention on Tobacco Control (WHO FCTC), on November 12, 2012, in Seoul, Republic of Korea.

Butera was reacting to a question by MP Francis Karemera on what could be done to eliminate tobacco in the country, including among its growers, manufactures, and traders.

“Tobacco consumption is not the problem; the problem is its producers, including factories. If its production is eliminated, people will not be able to consume it,” Karemera argued.

Tobacco taxation impact

When the law relating to the control of tobacco was enacted in 2013, Butera said, data showed 12.9 per cent of Rwandans smoked tobacco as of 2012, but that rate dropped to 7.1 per cent currently.

“This indicates that there is a five per cent reduction in smoking since the enactment of the law. What is gratifying for us and shows that we are on the right path, is that the use of tobacco is reducing significantly,” he said.

Butera said the achieved reduction in smoking was attributed to factors including imposing higher tax charges in order to lower people’s purchasing power and making it difficult for them to buy tobacco, which in turn significantly reduces its consumption.

“When consumption goes down, some factories also reduce the quantity of tobacco they produce as the demand decreases,” he said.

Elaborating on taxation, Butera said that currently, there are three types of taxes on tobacco in Rwanda, indicating that there is 36 per cent tax on the retail price of a pack [of 20 rods (sticks)], plus Rwf130 per pack.

According to data from Rwanda Revenue Authority (RRA), Rwanda also increased the cigarette excise tax (tax levied on manufactured or imported cigarettes) from 60 per cent in 2001, to 120 per cent in 2007 and 150 per cent since 2009.

Information from RRA suggests that compared to the region, Rwanda has the highest excise tax on cigarettes, comprising 50 per cent of the total retail price of a pack, followed by Burundi (39 per cent), Kenya (35 per cent), Uganda (25 per cent) and Tanzania (11 per cent).

MP Veneranda Nyirahirwa asked whether tobacco has any benefit to humans.

“We are usually struggling with signing agreements about tobacco. What is in tobacco that can help a human body,” Nyirahirwa queried, suggesting that it should be eliminated in case it does not have any advantage to humans.

Minister Butera pointed out that no research has shown that tobacco has importance to a human being, rather, it is one of the risk factors for heart and respiratory diseases, cancer, and diabetes, among others, underscoring that the Ministry of Health was implementing anti-smoking campaigns.

Meanwhile, Butera said though raising the cost of tobacco makes some people unable to afford it, there is tobacco that is smuggled into the country, and it is relatively low-cost since it evades the charges including taxes.

He indicated that the passing of the above-mentioned protocol law will help tackle tobacco smuggling, adding that they will scale up anti-tobacco measures.

Among other provisions, the protocol states that with a view to eliminating illicit trade in tobacco products, each party shall monitor and collect data on cross-border trade in tobacco products, including illicit trade, and exchange information among customs, tax, and other authorities, as appropriate, and in accordance with national law and relevant applicable bilateral or multilateral agreements.

Also, each party to the agreement should enact or strengthen legislation, with appropriate penalties and remedies against illicit trade in tobacco products, including counterfeit and contraband cigarettes.

Source: NewsTimes