Views & Reviews Personal View

A tax on indoor tanning would reduce demand in Europe

BMJ 2012; 345 doi: (Published 02 October 2012) Cite this as: BMJ 2012;345:e6550
  1. Simon Nicholas Williams, clinical research associate, public health, Feinberg School of Medicine, Northwestern University, Chicago, IL 60611, USA
  1. simonwilliams{at}

The use of indoor tanning beds has been established to be a serious risk to human health.1 In the European Union, Northern Ireland is the latest country to pass legislation that prohibits under 18s from using indoor tanning equipment. Although this will protect children from this risk, more needs to be done if we are to respond to the International Agency for Research on Cancer’s suggestion that we need also to “discourage young adults from using indoor tanning equipment.”1

Globally, the incidence of cutaneous melanoma has increased faster than any other common cancer, with an approximate doubling of rates every 10-20 years in countries with predominantly white populations.2 For instance, in 2008 there were about 70 000 incidences of, and more than 14 000 deaths from, melanoma in the European Union.3 Although attempts at public education by health agencies and charities have increased, these are being obscured by spurious claims by the indoor tanning industry of the benefits of indoor tanning.4

Recent lessons from tobacco control in the EU teach us that tax increases are the single most effective intervention to reduce demand for harmful products.5 The EU needs to follow the example of the United States by introducing a so called tan tax; an excise on indoor tanning services. A new EU directive for the taxation of indoor tanning services would complement existing directives focused on product safety.6 Importantly, these excise duties would provide additional revenue for governments and reduce numbers of melanomas and other skin cancers—something that would also subsequently reduce governments’ healthcare costs. All or a portion of this revenue could be earmarked for public health education initiatives warning of the dangers of ultraviolet radiation exposure.

As part of its attempt to fund healthcare reform, the Obama administration introduced in July 2010 a 10% excise duty on indoor tanning. It is estimated that the tax will raise $2.7bn (£1.67bn; €2.1bn) in revenue over a decade.7 Subsequent research from the US suggests that there has been high compliance with the legislation, with 80% of salons collecting the tax from customers. Also, early evidence indicates that use of indoor tanning equipment has declined after the introduction of the tax, with salons reporting about a quarter fewer clients.8

Taking the United Kingdom as an example, I estimate that over a decade a 10% excise duty on indoor tanning could raise revenues of between £95m and £113m. The price elasticity of demand is a measure used in economics to denote the percentage change in demand for a product after a change in the price of that product. Although substantial data are lacking on price elasticity of demand for indoor tanning services, I can make some predictions. Despite early US evidence of an overall decline in use, indoor tanning services might still have a relatively low price elasticity of demand.8 That said, indoor tanning services may be more elastic than tobacco, given its addictive nature, and therefore more sensitive to price increases.

The average price elasticity for demand for tobacco in EU member states has been estimated at between −0.5 and −0.7 (price elasticity values are usually negative).9 As such, we might suggest that the lowest price elasticity for demand for sunbeds would be −0.5; that is, with a 10% tax induced price increase, the use of indoor tanning services would probably decrease by 5%. It is more likely, however, that the price elasticity of demand for indoor tanning services would be somewhere in the region of −1.0 to −2.0 (where a 10% price increase would mean a 10-20% decrease in use). Additionally, because businesses in the UK and EU are accustomed to the collection of consumption taxes on the purchase price of products (for example, value added tax), there is little reason to suspect that compliance will be a problem. Using lower and upper elasticities of demand of −0.5 and −2.0, I estimate basic revenue in the UK of £95m to £113m over a decade (see box). Of course, this amount would change in the event of additional tax increases.

The most price sensitive populations (that is, responsive to tax increases) are low and middle income populations.5 Data from the UK show a strong trend between the number of indoor tanning outlets in an area and its level of deprivation, with about twice as many indoor tanning outlets found in low income areas as in high income areas.10 Given that current demand for indoor tanning services in low income areas is double that of high income areas, and given that the price elasticity of demand is likely to be higher for the former, public health gains from the introduction of a substantial excise duty on these services would be maximised.

More research is needed to update our knowledge of indoor tanning behaviours in the EU and to establish more specific price elasticities of demand for indoor tanning services. However, as the case of tobacco has shown, for substantial public health gains, taxation at higher rates is necessary. When you consider that the current EU directive for cigarettes ensures that the overall excise tax is a minimum of 57% of the total (tax inclusive) retail sales price,11 then a 10% tax on indoor tanning services is probably inadequate from a public health perspective. Indoor tanning salons and manufacturers of indoor tanning equipment are likely to oppose such an intervention. However, the profit margins of any industry should not be allowed to compromise policies that enable gains in public health.

We should also explore ways in which indoor tanning salons can promote so called spray tanning services at the expense of ultraviolet tanning. Making high quality spray tanning services more available and affordable, particularly to poor customers, might help to offset opposition from some indoor tanning advocates to the introduction of an excise duty. However, at the very least, the introduction of an excise tax—at any rate—on indoor tanning services is essential as a starting point for future tax increases, and as a means of acknowledging that indoor tanning, like tobacco, is a primary tier carcinogen that warrants its own sin tax.


I calculated the estimated projected revenue using this equation:

Estimated total number of regular sunbed users (not including home use) × mean number of sessions per year × mean cost of a session × tax percentage × percentage of reduction in use of tanning services × number of years = estimated 10 year tax revenue.

Assuming a −2.0 price elasticity of demand: 1.5 million × 11 × £7.20 × 0.1 × 0.80 × 10 = £95 million

Assuming a −0.5 price elasticity of demand: 1.5 million × 11 × £7.20 × 0.1 × 0.95 × 10 = £113 million.

I adjusted the estimated baseline tax revenue using price elasticities of demand to take into account the reduction in use after the tax induced price increase. The figures assume a 100% compliance with the legislation, and do not take into account any tax offsets.

The estimated number of users and the average number of sessions per year were derived from consumer research, including a 1996 report on suntanning and sunbeds.12 This report is to my knowledge still the most complete data source on adult sunbed use and behaviours in the UK. It was considered as recently as 2009 by the Committee on Medical Aspects of Radiation in the Environment10 and by the National Assembly for Wales.13 Additionally, data from the US suggest that sunbed use has remained at similar levels to those of the mid 1990s.14 More research on the use of indoor tanning services is needed. If use has increased in the UK, then this of course represents a greater threat to public health, but also an opportunity for additional tax revenues and public health gains to be made from the introduction of an indoor tanning tax. The average cost of a session was derived from data from an online sample of UK tanning salons throughout the UK and their services and prices (mean length of session × mean cost per minute).


Cite this as: BMJ 2012;345:e6550