Why smoking is costly for the economy and bad for the environment
As the world commemorated the World No Tobacco Day on 31 May 2023 under theme “Grow food, not tobacco”. This day should serve as a constant reminder that smoking is a leading global cause of preventable disease and death.
Tobacco use remains a public health problem in Kenya despite several concerted control efforts. In 2022, the World Health Organisation estimated that the use of tobacco killed at least 8 million people across the world and 9,000 people in Kenya. Tobacco use also places a significant economic burden on society.
The economic costs of tobacco attributable disease on the Kenyan economy is estimated at Kes15 billion yearly. The total global economic cost of smoking is estimated at around $US1.85 trillion, equivalent to 1.8 percent of global GDP annually in healthcare spending and in direct cost related to lost productivity. This gives a complete picture that the total burden caused by tobacco products far outweighs the economic benefits from their manufacture and sale.
Tobacco smokers’ cut their life expectancy by at least 13 years compared to that of non-smokers. Exposure to secondhand smoke poses a serious health risk, causing more than 41,000 deaths annually. Pregnant women who are exposed to secondhand smoke are more likely to have a complication before and after child delivery.
Children are not immune to this danger; each year, 150, 000 children under the age of five are killed by secondhand smoking. The deleterious effect of tobacco extends to smokeless tobacco, also a known cause of cancer. The nicotine content in smokeless tobacco, which is higher in women, increases the risk of sudden death due to irregular heartbeat.
This health burden comes with substantial economic costs, directly through healthcare costs for treating the disease and indirectly through lost productivity resulting from tobacco-related morbidity and mortality. Tobacco use is causally linked to diseases in almost all organs of the body. Smoking reduces workers’ productivity and shortens their careers due to chronic illness and premature death.
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In America, it is estimated that the total productivity losses due to tobacco use are estimated to be as high as US $151 billion per year. Breaking this down further, studies estimate the additional cost of tobacco use to be $5,816 per year per tobacco-using employee compared to a non-smoking employee.
This number accounts for everything from absenteeism to higher healthcare costs. Adjusted for inflation, that’s over US $8,000 in 2021.The number is expected to continue increasing as inflation rises and tobacco use remains prevalent.
To reverse the dire consequences of tobacco use, the superior approach is to hike tobacco taxes as this will expand the fiscal capacity of government while reducing the risk of non-communicable diseases which account for 74 percent of all deaths globally. A study in China estimated that a 50 percent increase in the price of tobacco through excise taxes would save 231 million years of life and reduce the cost of treating tobacco-related diseases by $24 billion.
Tobacco use is not only killing people, it is also poisoning the environment. Similarly, it endangers the health of the planet with an environmental burden of 600 million trees cut down annually for tobacco production, 200 000 hectares of land, 22 billion tonnes of water and 84 million tonnes of CO2. In addition, agrochemicals used in tobacco cultivation poisons the land, soil and water, and this leads to food insecurity because tobacco farming diverts agricultural land that could otherwise be used to grow food. Cigarette smoking alone pollutes the air ten times more than diesel gas emissions.
The World Health Organisation, estimate that 4.5 trillion cigarette filters pollute the oceans, rivers, soil and beaches every year. Moreover, according to Truth Initiatives, about 4.2 million cigarette butts were collected from beaches and waterways globally in 2019, making them the world’s second most common type of environmental litter after food wrappers.
The cigarette butts contain toxic chemicals such as nicotine and heavy metals which poses grave danger to aquatic life and microorganism.
Taxation as a mitigation measure
Tobacco taxation, passed on to smokers in the form of increasing excise duty on cigarette, has widely been embraced not only as one of the most effective control strategies for decreasing smoking and its adverse health consequences but also as an effective strategy for reducing the environmental hazard of tobacco.
Increase in tax on cigarettes reduces consumption and increases government revenues that can be used to fund priority investments and projects that may benefit the entire population.
When tobacco taxes go up and cigarette prices skyrocket, smokers with low incomes bear the brunt of the effects of tobacco consumption because they are more sensitive to price changes in tobacco products. Thus, an increase in prices will have a significant effect in suppressing the consumption hence improving public health on aggregate.
Increasing tobacco taxation and an effective tobacco taxation system should be a top public health priority for government. In June 2015, while the government of Kenya introduced a uniform specific rate of Kes2500 per 1000 cigarettes or Kes50 per pack (Excise Duty Bill, 2015).
However, the policy puts the excise tax burden at 35.6 percent share of the retail price of cigarettes. This is below the WHO recommended minimum benchmark of 75 percent of retail price.
The feasible elements to be considered simultaneously are extending regulation and taxation policies to tobacco products and sales to eliminate single-use filters and reduce post-consumption waste, and quadruple tobacco tax levy at intervals with a focus on increasing revenues as this will force poor smokers to quit smoking and in turn this will improve public health well being and protect the environment.
This strategy will lead the country towards the realization of SDG Target 3.4 which calls for countries to reduce the number of deaths from non-communicable diseases (NCDs) by 30 percent by 2030. While increase in tobacco taxation has been touted as an effective way to deter smoking, research has shown that there are several unintended consequences or negative externalities that may unfold.
High excise taxes may fuel the growth of black-market activity for tobacco products that would perhaps be more harmful to the consumers. The best option would be for the government to prioritize tobacco harm reduction by developing policies that allow consumers access to safer tobacco alternative such as vaping or e-cigarette.
