Higher cigarette prices would help millions avoid poor health and extreme poverty

According to a study published in the these days in BMJ, a significant increase in prices of cigarette would aid millions of people at the global level to avoid poor health and extreme poverty.
Objective To examine the impact of a 50% increase in market prices of cigarettes on health, poverty, and financial protection.

Design Compartmental model study.

Setting 13 middle income countries, totalling two billion men.

Participants 500 million male smokers.

Main outcome measures Life years gained, averted treatment costs, number of men avoiding catastrophic healthcare expenditures and poverty, and additional tax revenue by income group.

Results A 50% increase in cigarette prices would lead to about 450 million years of life gained across the 13 countries from smoking cessation, with half of these in China. Across all countries, men in the bottom income group (poorest 20% of the population) would gain 6.7 times more life years than men in the top income group (richest 20% of the population; 155 v 23 million). The average life years gained from cessation for each smoker in the bottom income group was 5.1 times that of the top group (1.46 v 0.23 years). Of the $157bn (£113bn; €127bn) in averted treatment costs, the bottom income group would avert 4.6 times more costs than the top income group ($46bn v $10bn). About 15.5 million men would avoid catastrophic health expenditures in a subset of seven countries without universal health coverage. As result, 8.8 million men, half of them in the bottom income group, would avoid falling below the World Bank definition of extreme poverty. These 8.8 million men constitute 2.4% of people living in extreme poverty in these countries. In contrast, the top income group would pay twice as much as the bottom income group of the $122bn additional tax collected. Overall, the bottom income group would get 31% of the life years saved and 29% each of the averted disease costs and averted catastrophic health expenditures, while paying only 10% of the additional taxes.

Conclusions Higher prices of cigarettes provide more health and financial gains to the poorest 20% than to the richest 20% of the population. Higher excise taxes support the targets of the sustainable development goals on non-communicable diseases and poverty, and provides financial protection against illness.

What is already known on this topic

• Higher excise taxes on tobacco are essential to reach the sustainable development goals to reduce mortality from non-communicable diseases by one third by 2030
• Low income groups are more responsive to price increases than high income groups
• There are few published studies of the distributional impact of higher tobacco taxes on health and financial outcomes

What this study adds

• Despite differences in socioeconomic class and health finance arrangements a 50% increase in tobacco prices strongly favours those in the bottom income group for life years saved, out-of-pocket expenses from tobacco attributable treatment costs averted, and avoidance of catastrophic health expenditures or poverty
• Higher tobacco excise taxes are a powerful but generally underused tool by most governments to reduce expenditures on treatment of diseases that are a major cause of income poverty
• In 13 middle income countries studied, around 450 million life years would be saved from higher excise taxes, contributing substantially to the target of the sustainable development goals of a one third reduction in mortality from non-communicable diseases at ages 30-69 by 2030

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