Background
New financial and other challenges threaten decades of public health progress. In Africa, half of the continent’s population lacks access to essential health services and more than 150 million people are pushed into or deeper into poverty each year by out-of-pocket health expenses. Health taxes on four harmful products—tobacco, alcohol, sugar-sweetened beverages, and junk foods—offer a powerful, proven solution. These taxes generate much-needed revenue, improve population health, and reduce health care costs. Countries including Rwanda, South Africa, and Ghana have demonstrated success, from reductions in smoking and sugar consumption to expanded access to health care.
The details of tax implementation are important. Smart design—such as specific rather than only ad valorem taxes, inflation adjustments, and protection against industry interference—maximizes impact. Tax stamps, as called for by the WHO Framework Convention on Tobacco Control, cost governments nothing and increase the revenue, transparency, and fairness of health taxes.
The recent Africa CDC Health Financing Report champions health taxes on alcohol, tobacco, and sugary drinks to generate sustainable health revenue. The African Union emphasizes that effective implementation requires transparent governance, regional harmonization, economic impact analysis, and regulatory oversight. The Task Force on Fiscal Policy for Health recent report, “Health Taxes: A Compelling Policy for the Crises of Today,” projected that a 20% price increase on tobacco, alcohol, and sugary drinks in Sub-Saharan Africa would generate more than $43 billion annually, enabling countries to preserve and expand health care services by more than doubling the public funds available for health care.
Catalytic action to transform data into results
Despite their proven effectiveness at raising revenue and saving lives, implementation of health taxes remains weak. This is a unique moment for sustainable health financing through health taxes. Successful implementation relies on three factors:
- Leadership commitment: Heads of State and Ministers of Finance and Health need strong resolve to withstand fierce lobbying from international companies that sell these products—and the companies and lobbyists they pay in every country.
- Civil society pressure: Civil society organizations are instrumental in country and across regions to advocate for equitable health tax policies with accountable enforcement mechanisms.
- Effective tax administration: Policy and economic expertise can be leveraged to design effective, evidence-based tax structures that lead to substantial revenues and major health gains.
Resolve to Save Lives welcomes the opportunity to explore partnership with governments to advance health taxes.