Our new study Ungenutzte Ressourcen shows: tobacco taxes are a public health policy generating revenues for governments. This paper is published in German, read the English summary here.

Effective Health Policy

Adopting the WHO Framework Convention on Tobacco Control (FCTC), the convention’s parties committed themselves to raise tobacco taxes. Longtime research had shown that higher prices for tobacco products lead people to not start smoking, to smoke less or to stop smoking.

According to the WHO, tobacco taxes should have the following characteristics to effectively decrease tobacco use. Tobacco taxes should

  • amount to at least 70% of the retail price;
  • be a mixt of ad valorem and specific excise taxes;
  • create a high minimum price floor with specific taxes;
  • be adjusted regularly or automatically to inflation and increasing income levels;
  • require secure and non-removable markings on tobacco products to avert smuggling (track & trace).

Our new study explains more on effects and composition of tobacco taxes.

Promote sustainable development

Tobacco taxes can contribute to achieve the Sustainable Development Goals (SDGs) in the global south. A worldwide increase in tobacco taxes of about 80% per cigarette pack would generate revenue amounting to 141 billion US dollar.

That is about 140-fold the amount which is currently attributed to tobacco control worldwide, which the WHO estimates at yearly 1 billion US dollars. Tobacco control is chronically underfinanced.

Tobacco use is still not acknowledged as the most preventable health risk. In the area of development aid for health (DAH) this is apparent as well. In 2015, funds for tobacco control amounted to 41 million US dollars worldwide. This is equivalent to only 0,1% of all DAH funds.

Therefore, tobacco taxes could contribute immensely to financing tobacco control. It would be a matter of dedicating or earmarking these revenues directly to public health policies. Some countries like Costa Rica, Congo or Australia already practice it.

In tobacco growing countries, tobacco tax revenues could also be channelled to alternative livelihoods for tobacco farmers, like in the Philippines.


Graen (2016): Ungenutzte Ressourcen: Tabaksteuern und nachhaltige Entwicklung [GERMAN only]

Graen (2016): Untapped Resources – English Summary

Tobacco taxes can generate domestic resources for governments to finance health and development policies.