NEW DELHI: Tobacco smuggling has a significant impact on public health and the revenue benefits of increased taxation.
Tobacco taxation is the single most effective means of reducing smoking rates in Ireland. The latest Tobacco Control Survey shows an overall prevalence of around 20 per cent among adults, down from 29 percent in 2004. Smoking rates among children aged 12 to 17 have dropped from 20 per cent in 2000 to 12 percent in 2012.
An increase in taxation of 1 percent would be expected to decrease tobacco consumption by 0.4 percent.
The effect is even greater among lower socioeconomic groups who are disproportionately affected by tobacco related disease and among children for whom higher prices are a disincentive to taking up smoking.
The tobacco industry cites smuggling as a reason not to increase tobacco taxes but it should be remembered that in years when the minister of the day has not increased tobacco taxes, the tobacco industry itself has increased the price in order to boost its own profits. Furthermore, the international tobacco industry itself has had to pay billions of euro in settlements and fines for its role in smuggling.
The penalties imposed on those organising and participating in smuggling need to be a real deterrent to smuggling.
We would like to see the Government commit to raising taxes on tobacco every year. In addition we would like to see some of the extra revenue ring-fenced for the purpose of funding programmes to support people in lower socioeconomic groups to quit smoking. The Government should also examine the possibility of a price cap on the profits of the tobacco industry.
Finally we would recommend the introduction of an environmental levy on tobacco to help offset the environmental damage caused by tobacco.
Let’s build on Ireland’s achievements in tobacco control and reduce the toll of death, disease and disability caused by this lethal and addictive drug.
