China unlikely to triple tax on tobacco to reduce number of smoker deaths

Vested interests work against Beijing taking up study finding that higher levy saves lives

PUBLISHED : Friday, 03 January, 2014, 4:36am
UPDATED : Friday, 03 January, 2014, 9:15am

The Chinese government is unlikely to act on a UK study that proposes trebling tobacco tax globally to reduce smokers by a third, experts say.

Researchers say that if the increase was implemented, 200 million premature deaths from lung cancer and other diseases could be prevented worldwide.

Although the government recently showed interest in controlling smoking by banning officials from exercising the habit in public areas, Chinese experts on tobacco control say it owns the country's tobacco industry, whose interests and profits were well protected.

The researchers said China had a responsibility to address the global smoking issue.

"Cigarette consumption in China continues to rise steeply and now accounts for more than 2 trillion of a worldwide total of about 6 trillion cigarettes smoked per year," they wrote in the paper.

"Tobacco already accounts for about 12 to 25 per cent of deaths among men in low- and middle-income countries such as China. A low reliance on specific excise taxes on tobacco by China ... discourages smoking cessation."

In the paper, published in the New England Journal of Medicine yesterday, researchers from Cancer Research UK said the tax hike, although dramatic, would encourage people to quit.

Professor Yang Gonghuan , director of China's National Office of Tobacco Control, said the Chinese government was unlikely to adopt the proposal to drastically raise tax.

Tax rises on tobacco have been discussed and studied for a long time but never implemented due to resistance from the powerful tobacco industry.

Similar studies in China also found that the tax rise would not hurt the government's tax income and confirmed the number of smokers would be reduced.

The central government raised tax on tobacco in 2009, but the industry was compensated through other policies which enabled it to increase the availability of cheaper cigarettes.

China's tax revenue from the industry reached 865 billion yuan last year, up 16 per cent from 2011.

A sales manager with a large cigarette producer in Guangdong said there was little fear in the industry that a sudden tax increase would be implemented.

"The government depends on us to generate the money to support many important sectors, such as military spending," he said, declining to be named.

"The officials can quit smoking, but they can't quit money."