Discussion: Increasing tobacco tax - Dual benefits for budget and health

The smoking rate among adult men in our country is still very high, over 41%. With more than 15 million smokers, Vietnam is among the countries with the highest number of tobacco users in the world .

Every year, more than 100,000 Vietnamese people die from tobacco-related diseases, of which nearly 19,000 deaths are due to exposure to secondhand smoke.

Worryingly, cigarettes are becoming increasingly accessible to young people, largely due to their low prices and the current tax policy not being a deterrent enough. In just one year, from 2022 to 2023, total cigarette production in Vietnam increased by more than 10%.

According to estimates, tobacco use causes Vietnam to lose more than VND108,000 billion each year, equivalent to 1.14% of GDP. This total economic loss is five times higher than the budget revenue from tobacco taxes. This shows that when tax rates are low, the state budget does not collect much while society has to bear heavy financial consequences.

According to the World Health Organization (WHO) and the World Bank, price and tax policies are the most effective tools to reduce tobacco consumption, accounting for up to 50% of the effectiveness in reducing smoking rates, especially among adolescents. However, the special consumption tax on tobacco in Vietnam is still low.

Discussion: Increasing tobacco tax - Dual benefits for budget and health - 1

In that context, the Law on Special Consumption Tax (amended) is expected to be discussed by the National Assembly at the 9th session.

In particular, the Ministry of Finance proposed two options to adjust the special consumption tax on cigarettes and proposed to apply option 1 (lower option) with a tax increase roadmap starting from 2027 with a minimum increase of VND 2,000/pack and reaching VND 10,000/pack by 2031, in parallel with maintaining the tax at the rate.

Is this the optimal solution in the current context of Vietnam? The online discussion " Increasing tobacco tax - Dual benefits for the budget and health" organized by Dan Tri Newspaper will focus on clarifying the medical and economic aspects of the tobacco tax increase policy, as well as analyzing the potential impact on public health.

The seminar had the participation of 3 guests:

- Professor Nguyen Anh Tri, National Assembly Delegate of Hanoi City.

- Dr. Nguyen Huy Quang, Head of Consulting, Criticism and Social Appraisal Department, Vietnam Medical Association.

- Ms. Sarah Bales, expert of Vietnam Health Economics Association.

Source: https://dantri.com.vn/suc-khoe/toa-dam-tang-thue-thuoc-la-loi-ich-kep-cho-ngan-sach-va-suc-khoe-20250605080708596.htm