Governments use corrective taxes to reduce the use of products that harm well-being and create costs not just to society at large (externalities) but also to individual consumers who may underestimate the future health consequences of their current consumption. Taxes on gas to reduce pollution or on carbon dioxide emissions to reduce greenhouse gases are classic examples of this approach.
CGD Policy Blogs
Tobacco use is the world’s leading cause of preventable death, claiming eight million lives per year, which together with tobacco-attributable disability is equivalent to an annual global productivity loss of 1.8 percent of GDP. Extensive evidence shows that tobacco taxation is the most effective and cost-effective measure to reduce tobacco use.
This blog and the accompanying CGD Policy Brief are a follow-up to the 2019 “Health Taxes Save Lives” report by the Task Force on Fiscal Policy for Health co-chaired by Michael Bloomberg and Lawrence Summers.
International commitments to curb duty-free sales of tobacco under the Framework Convention for Tobacco Control have been largely ineffective, despite their potential to contribute to tobacco control as well as fiscal goals.
Tobacco taxes are a highly effective instrument to reduce the consumption of tobacco, discourage new young smokers, raise government revenue, and help reduce the social and economic costs of tobacco products consumption, estimated at 8 million premature deaths per year and costing 1.8 percent of global output in health costs and productivity losses.
With the 2019 Nobel prize for economics going to Western economists combating poverty in LMICs through RCT-generated evidence, the time is ripe for the global community and national leaders to invest in a similar and yet different type of capacity: local pragmatic research infrastructure for learning healthcare systems.
The New Syntax of “Sin” Taxes: Framing Health Taxes to Strengthen Public Finances and Advance Population Health
The establishment of universal health coverage is one of the key pillars of progress toward the Sustainable Development Goals (SDGs), particularly SDG3. What impact could taxing tobacco, alcohol and sugary beverages have on reducing the burden of noncommunicable diseases as we strive to achieve the SDGs?
New High-Level Report Calls for Higher Taxes on Tobacco, Alcohol, and Sugary Beverages to Prevent Millions of Deaths
The Task Force on Fiscal Policy for Health, co-chaired by Michael Bloomberg and Lawrence Summers just launched a report calling on governments to substantially raise taxes on tobacco, alcohol, and sugary beverages. Such policies could avert an estimated 50 million premature deaths while raising $20 trillion of new revenues. This isn’t particularly new news to the global health community which has been pushing for increased taxes to reduce consumption of products which are toxic to health. But it IS news that this Task Force has issued such a strong report for at least two reasons.
Can Taxes Postpone Millions of Deaths Worldwide? A New Task Force Led by Michael Bloomberg and Lawrence Summers Inquires
This week, Mayor Michael Bloomberg and former Treasury Secretary Lawrence Summers announced a new Task Force on Fiscal Policy for Health. This is the first time such a high-level group of respected economic and fiscal policy opinion leaders has convened on this issue, creating an opportunity to acknowledge the importance of taxes for promoting health and to take action to save lives.