Speech contest promotes tobacco tax hikes

Content image - Phnom Penh Post
A man smokes a cigarette in Phnom Penh’s Chbar Ampov district in March. Heng Chivoan

Covid-19 may be scary, but it is not as frightening as another hidden danger that is killing more than 480,000 people every year, said Sim Srey Leap from Net Yang High School in Battambang province, who won the first prize in the “Measures to increase taxes on tobacco” public speaking contest.

Srey Leap said during the May 23 event, which drew top students from across the Kingdom, that cigarette smoking had cost the nation’s economy dearly and plunged families into poverty.

“Having seen such an impact, Cambodia needs to increase taxes on tobacco. Today, tobacco taxes in Cambodia are only 25 to 31 per cent, which is lower than those in other Asian countries,” she said. “Cambodia should increase taxes by at least 75 per cent, compared to the retail price.”

The high school student said that according to the government’s plan, it is not possible to immediately increase taxes by up to 75 per cent. But she noted that it could be made a reality if the government appeals to the understanding of the people as to the harms and dangers of smoking, and how it threatens the country’s development.

Roth Channet of the University of Puthisastra, who came in second in the competition, noted that May 31 is World No Tobacco Day. She said she “wondered how many times the world had to mark this day before the dream of a tobacco-free world would come true.”

“I think that, with the risks posed by cigarette smoke, Cambodia should not hesitate to increase tobacco taxes. If Cambodia increases the taxes, then the rates of illness and death as a result of smoking will drop, and the country’s economy will grow,” she said.

Citing the National Meanchey University’s 2021 survey, Channet added that about 94 per cent of Cambodians had supported a 62 per cent increase in tobacco taxes.

Ray Rany, head of tobacco and alcohol at the Ministry of Health’s National Centre for Health Promotion, said while presiding over the competition that the Tobacco Control Commission had laid out the National Strategic Plan on Tobacco Education and Reduction 2021-2026, and that the plan would soon be implemented in Cambodia.

“This tobacco tax policy is a win-win strategy that will reduce the rate of tobacco use in Cambodia. We consider the strategy of increasing tobacco taxes a winning one – a strategy that increases the national budget revenue and reduces the use of tobacco or the possibility of buying tobacco products,” she said.

Citing World Bank research, and echoing Srey Leap’s proposal, Rany said Cambodia should increase tobacco taxes to 75 per cent of their retail price. Currently, tobacco tax rates in the Kingdom are just under half that of the World Bank’s recommendations.

“In this world, there is only one [type of] tobacco that kills people and it is legal ... The World Health Organisation (WHO) does want to see tobacco classified as an illegal product, but it is challenging to make that a reality as many people around the world are addicted to it,” Rany said.

Health ministry secretary of state Thea Kruy said Cambodia had employed many means to reduce smoking, and that increasing taxes should always be a last resort. “The increase in tax is the determining factor of reducing the number of smokers… I support this idea, but education is still very important in quitting or reducing smoking,” he said.

Ministry of Economy and Finance undersecretary of state Van Puthipol, who also serves as deputy head of the General Department of Taxation (GDT), said that though he was supportive of the idea of taxation in theory, he noted that it may fail due to the possibility of high rates of tax evasion as Cambodia imports most of its tobacco products.

“Our country is not a cigarette producer. We mostly import cigarettes. Thus, the chances of tax evasion are high through smuggling and our income will not increase,” he said.

Instead of raising taxes, authorities should institute a ban on advertising, he added, as well as initiatives to help smokers quit, and suggested that cigarette packets should carry government health warnings.

He also said that though the increase in the taxes “really matters”, it should be a last resort, adding that deterring young people from taking up smoking should be the priority.

The NGO Cambodia Movement for Health (CMH) said in a statement that the increase in tax has been the most effective measure in reducing the number of deaths and the economic cost stemming from tobacco. Cambodia ranked fourth in the world for lowest taxes on tobacco, it said.

“If Cambodia increases the tax to 75 per cent of the retail price of cigarettes on the recommendations of the WHO and the World Bank, Cambodia will receive $235 million in additional income tax in the next five years and $933 million in the next 15 years,” said the statement.