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Taxes on alcohol, tobacco, and soft drinks are fair and produce health gains, review finds

BMJ 2018; 361 doi: (Published 05 April 2018) Cite this as: BMJ 2018;361:k1524
  1. Susan Mayor
  1. London

Taxes on alcohol, tobacco, and soft drinks offer a particularly effective strategy for reducing chronic disease among the poorest people in society who are disproportionately affected by unhealthy products, a review has found.1

Lawrence Summers, from Harvard University in Boston, USA, said in an accompanying editorial, “One of the most common arguments used to oppose taxing tobacco, alcohol or sugary beverages is the claim that such taxes are regressive—that it is unfair to make poorer people pay a larger share of their limited household incomes to consume these products than richer people.”2

He said that the new analysis “helps clear the air over one of the most common obstacles to taxing the consumption of goods that kill us—namely, the argument that such taxes are regressive.”

The review,1 published by the Lancet’s taskforce on non-communicable diseases and economics, showed that the burden of preventable non-communicable diseases associated with tobacco, alcohol, and obesity is itself regressive.

Researchers systematically analysed 283 studies of the temporal, probable, and causal relation between socioeconomic status and non-communicable diseases. They included studies from Brazil, China, and India. Although the quality of the studies varied considerably, results gave high grade evidence of a positive and consistent association between low socioeconomic status and non-communicable diseases.

A second study3 showed that increasing the taxation of potentially unhealthy products was likely to bring the greatest benefits for people on low incomes because they generally had the strongest response to price changes. The researchers assessed patterns of consumption by socioeconomic status in tobacco products, alcoholic beverages, non-alcoholic beverages and snacks, and confectionery, using available data from 13 countries (Chile, Guatemala, Panama, Nicaragua; Albania, Poland, Turkey, Tajikistan; Niger, Nigeria, Tanzania; India; and Timor-Leste).

Results showed that high income households generally spent more on and consumed more alcohol, soft drinks, and snacks than low income households, although tobacco patterns were less consistent.

As a proportion of total household expenditure low income households were more affected by price changes than high income households in simulations carried out as part of the study. For example, the response to the possible introduction of a minimum alcohol price in the UK was estimated to be 7.6 times larger in the poorest households than in the wealthiest. And in Mexico the introduction of a soft drinks tax resulted in an average 17% decrease in purchases among lower income groups and almost no change in higher income groups.

Rachel Nugent, of the non-profit research organisation RTI International in Seattle, USA, and chair of the Lancet taskforce, said, “Non-communicable diseases are a major cause and consequence of poverty worldwide. Responding to this challenge means big investments to improve healthcare 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.”


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