Polluter pays – increasing funding for global tobacco control

In the August 2010 issue of Tobacco Control, Cynthia Callard wrote an enlightening article on just how uneven the playing field is in tobacco control. She compared the 2008 total revenues of the five major tobacco companies that control 90% of the global market as compared to the total amount spent on global tobacco control. The results show just how much the deck is stacked against effective tobacco control, especially in low and middle income countries. The revenues of these five companies exceeded $300 billion ($160 billion of that is provided to governments as tax) and the corporate earnings of the four publicly traded companies were over $25 billion, of which $14 billion was retained after corporate income taxes were paid. In comparison, funding for global tobacco control was a paltry $240 million. That would be less than 2% of the retained earnings of the four public companies alone.
Considering the profitability of the devastating global tobacco death toll – to say this seems unjust is a gross understatement. What is even more nauseating, is that these profits are coming from some of the poorest people in the poorest nations in the world and ending up in the pockets of wealthy stockholders in the richest countries.

In her article, Callard proposes innovative solutions to divert some of this money to tobacco control

  • :use of transaction taxes on the flow of profits from countries where multinational tobacco companies sell cigarettes to countries where theydistribute the profits or other fiscal instruments
  • health promotion surtax on tobacco manufacturers’ earnings or ringfenced taxes on consumption of tobacco products
  • develop guidelines under the auspices of the FCTC to mandate the use of profit taxes to raise funds for national and international tobacco control efforts

What do you think? How can we increase funding for global tobacco control? Should we push for a “polluter pays” system? What other innovative models could be adopted?

  • Repace

    From my perspective as a researcher, the amount of money available to fund Cynthia is right. For example, research funds for secondhand smoke (SHS) exposure research are rapidly dwindling to zero. This sort of research gives a very big bang for a buck. If you doubt this, just Google my name and see how upset the Smokers' Rights Goons who front for Big Tobacco are with my research alone. And I am far from the only target. More specifically, the biggest remaining problem to be researched is secondhand smoke infiltration in multi-family dwellings, which affects tens of millions of people in the U.S. alone. I don't know of any State health departments outside of California who are providing research funds to study this widespread problem, and California doesn't have enough to fund a major study. Most State and local health departments in the U.S. don't even want to hear nonsmokers' complaints on this issue. It's a sad state of affairs.

    James Repace, MSc.
    Visiting Asst. Professor, Tufts University School of Medicine, Dept. of Public Health
    FAMRI Dr. William Cahan Distinguished Professor

    email: <repace@comcast.net>
    website: <www.repace.com>

  • Ksehmi

    Unless there is an ultimate startegic objective of total ban on global tobacco growing, handling, storing, transporting and manufacturing, we are doomed to creating a new problem of an ever expanding state (international now) tobacco control machinery. The cost of implementing the whole of WHO FCTC terms and then enforcing and policing it is prohibitive to developing countries. If we are to learn from history, particularly the history of “international legislation”, the case United States v. Libellants and Claimants of the Schooner Amistad, 40 U.S. (15 Pet.) 518 (1841) is a very good point to start. It happened at the cupse of a tremendous change process of ending Slavery, not only in the South (USA) where today most tobacco is now grown or where main global tobacco IPR revenues flow to (patents, brands and other licencing rights), but also the World. The US supreme court rulings shows how difficult it is to enforce and manage an international control regime when so many grey areas of jurisdiction, interests, status, property rights and other things are thrown in. A total ban means that there will be no grey areas. It becomes a statutory offence – no mens rea defences!

  • An Qijie

    It doesn't matter whether 90 percent of worldwide tobacco is controlled by 5 or 5000 companies. Combined, they sell the same quantity of tobacco. Focusing on the bigger companies is a naive and emotional response. Let government tax apply to every stick of tobacco, regardless who sells it. Let the user pay, because he is the one we want to turn away from tobacco.

  • Philippe

    i remember the time when WHO was advocating to set aside 1% of the tobacco taxes to fund tobacco control. Strangely this proposal has disappeared. I wonder why as it would be a very simple (and effective?) way to make tobacco control sustainable financially. At the same time, do we really need much more “research”? Don't we know already most (if not all) what is needed to regulate tobacco?
    As for the cost of implementation I am not sure it is that high. So there is definitely a need for enough funding but I think if the 1% objective could be achieved it would be enough. I would be grateful if anybody could retrieve official WHO's documents about the 1%.

  • Ben Palmer

    However you distribute the money, the money is “coming from some of the poorest people in the poorest nations in the world”. How would giving the money to self appointed “guardians of public health” alleviate the charge on the poorest'

  • db

    This is totally bizarre, what's all this talk about extra taxation, 'control' and 'polluter pays' ? If tobacco is that dangerous, and kills half its users, why is no one in authority or with influence demanding an immediate BAN of its sale and use? It's almost as if TC doesn't want total prohibition..

  • I once thought we could subsidize these companies to not grow tobacco, but it sounds like that wouldn't work very well since their profits are in the stratosphere. I do find it interesting though, that tobacco causes so much disease and has such a high rate of causitive mortality and yet it continues as an industry, yet cocaine and other like-substances are illegal, despite their relatively speaking lower mortality. Not that I'm endorsing those, just using them as comparators.

    I imagine having tobacco “grandfathered” into our economic consciousness from the days of the explorers has cemented it's place in our society. Clearly though, something has to be done. Smoking related illnesses are almost as expensive as the tobacco companies' revenues, approaching $200 billion last year. So, it's certainly not like there's a terrible financial motivation on healthcare's side of the argument. It just doesn't get articulated as well.