WHO recommends increasing taxes on tobacco and alcohol

On November 22, 2010 the World Health Organization (WHO) released its annual Health report on financing health systems and universal coverage. The report recommends governments to raise the taxes on tobacco and alcohol to help pay for healthcare of millions of people who are unable to afford it worldwide.

The need for guidance in this area has become all the more pressing at a time characterized by both economic downturn and rising health-care costs, as populations age, chronic diseases increase, and new and more expensive treatments
become available.

"Tens of millions of people are pushed into poverty each year as a result of rising costs for health care” the World Health Organization said. "Governments worldwide should also increase the proportion of health-care costs they cover to reduce out-of-pocket expenses for patients whose illnesses can subject them to financial catastrophe", said the report.

To raise funds to boost access to health care, the WHO "suggested governments should look at diversifying sources of revenue from levies such as 'sin' taxes on products like tobacco and alcohol, currency transaction taxes, and national 'solidarity' taxes on certain sectors”.

"A 50 percent increase in tobacco excise taxes would generate $1.4 billion in 22 low-income countries, and a levy of 0.005 percent on currency transactions in India alone could raise about $370 million a year” the WHO said.

"So-called sin taxes have the advantage of raising funds and improving health at the same time by reducing consumption of harmful products such as tobacco or alcohol," the WHO said.

Countries need to be smart and effective when revaluating healthcare costs for its citizens. Instead of cutting measures that benefit healthcare, raising taxes on goods that can garner incoming and help lead to a more healthy and safe society need to be implemented. The WHO will continue to release data and publications to help get support for its new and health efficient cause.