by Ranabir Bhattacharyya | 30 APR 2018
All over the world, imposing taxes on soft drinks, alcohol and tobacco is considered to be a strong tool in response to rising rates of non-communicable diseases (NCDs). The Lancet in this regard has come up with a comprehensive analysis to date of evidence bringing together data from across the globe on expenditure, behaviour and socio-economic status. Interestingly, the evidence helps counter fears that such taxes will necessarily disproportionately harm the poor. At present, non-communicable diseases such as cancer, heart disease and diabetes are responsible for 38 million deaths each year, 16 million of these are among people aged under 70. The Sustainable Development Goal NCD target (SGD 3.4) is to reduce deaths from NCDs by a third by 2030 and promote mental health.
The Lancet Taskforce on NCDs and economics is a partner of the WHO’s Independent High-Level Commission on NCDs. According to Dr Rachel Nugent, RTI International (Seattle, USA) and Chair of The Lancet Taskforce on NCDs and economics. “Non-communicable diseases are a major cause and consequence of poverty worldwide. Responding to this challenge means big investments to improve health care systems worldwide, but there are immediate and effective tools at our disposal. Taxes on unhealthy products can produce major health gains, and the evidence shows these can be implemented fairly, without disproportionately harming the poorest in society.”
Interestingly, evidence from 66 international studies on 13 chronic diseases, categorically concludes that NCDs place a substantially higher economic burden on low income households compared to higher income households, especially in the absence of health insurance. Uninsured patients experienced a 2-7 fold increase in the odds of catastrophic health spending compared with insured patients. Even with protective health insurance, there can be high levels of co-pays or a lack of coverage for specific treatments, which can lead to catastrophic expenditure for households. No doubt, an important policy response with regard to NCDs is to provide financial protection through tax-financed health care and social health insurance programmes, and within these programmes, provide for the subsidisation of interventions that are cost-effective,
The comprehensive analysis of existing data will help governments in different countries to understand and interpret the potential impact of taxes, and inform whether their use is justified. Here the analysis is based on available data from 13 countries (Chile, Guatemala, Panama, Nicaragua, Albania, Poland, Turkey, Tajikistan, Tanzania, Niger, Nigeria, India and Timor-Leste) and it can be conferred that taxes can produce major health gains for poorest in society. On the other hand, the evidence suggests that concerns about higher taxes on tobacco, alcohol, and soft drinks harming the poor are overstated. Price policies such as taxes will be a key part of the response to rising rates of non-communicable diseases.
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