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Taking a cue from Health Minister Harsh Vardhan, oral health experts urged Finance Minister Arun Jaitley to levy high taxes on tobacco products to curb the youth from getting addicted to smoking or chewing tobacco. 'Increasing the price of tobacco products through higher taxes is the most effective way to make addicts quit smoking or chewing tobacco,' Indian Dental Association (Karnataka branch) president M.L.V. Prabhuji said in a statement on Sunday. In a bid to discourage smoking or chewing tobacco among youth, Harsh Vardhan Saturday exhorted the central and state governments to impose 50 percent value added tax (VAT) on all tobacco products to make them unaffordable.
He has also written to Jaitley to hike levies on tobacco products substantially in the ensuing union budget for this fiscal (2014-15), so as to act as a deterrent to millions of addicts across the country. 'On the advice of the World Health Organisation (WHO), the World Bank has recommended a whopping 65-80 percent tax on tobacco products to prevent children from taking to smoking,' Prabhuji said.
The Rajasthan government levies 60 percent VAT on tobacco products. 'People from the lower socio-economic strata and youths are most sensitive to price rise but are least able to afford medical care when required,' said Krishnadevaraya Dental College professor Murali Iyer. As one of the early signatories to the international health treaty of the WHO, India is obligated to hike taxes on tobacco products so as to curb their consumption under the framework convention on tobacco control.
Lamenting that Karnataka was one of the few states to levy zero tax on beedis, made of tobacco leaf, and lower tax (17 percent) on cigarettes, Prabhuji said that even a 10-percent increase in taxes would reduce consumption by 9.2 percent in rural and 8.5 percent in urban areas. Himachal Pradesh and Jammu and Kashmir are two states where tobacco products are taxed at 36 percent and 40 percent respectively. 'Increasing the retail price of tobacco products will deter youths from smoking or chewing and the funds generated from higher taxes can be used to fund oral health programme to create awareness on the harmful effects of such addictions,' IDA secretary H.C. Kishore said.
Will higher taxes help in India?
Despite having so many tobacco consumers, the average tax on a pack of cigarettes is just 43% which is lower than the levy of 65-80% suggested by the WHO. In the letter, Dr Harsh Vardhan also pointed out that users tend to shift from longer to shorter cigarettes whenever there is a tax hike and there should be a blanket hike on all forms of cigarettes including long and short ones.
The government will also look to tax heavily smokeless products and bidis which often escape the heavy taxes inflicted on cigarettes. From now on, makers of pan masala and gutka will feel the heat as taxes are to be linked to the capacity of a gutka factory and not to the size of the packet of tobacco. It's believed that this will earn the government Rs 4000-5000 crore while saving millions of lives.
An earlier study has shown that an increase in tobacco price by 50% would help to avoid 4 million deaths and get 3 million to quit smoking while 3 million other potential smokers (children) would also be dissuaded.
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