Small tax increase in high-burden countries could expand treatment numbers by at least one-third
A modest increase in taxes on alcohol and tobacco in countries seriously affected by HIV and TB could generate enough income to cover the costs of antiretroviral treatment, TB treatment and malaria treatment and prevention, as well as reducing the incidence of non-communicable diseases caused by alcohol and tobacco, according to modelling work presented at the 19th International AIDS Conference (AIDS 2012) in Washington DC.
Andrew Hill of Liverpool University said that other taxes could potentially raise millions for the global HIV response, as well as for other public health priorities.
Presenting what he dubbed a "Global Health Charge," Hill suggested that a one-US-cent tax per ten millilitres of alcohol (the equivalent of 2 Kenyan shillings per bottle of beer) and a 10-US-cent tax on a pack of 20 cigarettes (8 Kenyan shillings) could generate enough money in 10 of the 20 countries facing the highest burden of HIV not only to fund universal access, but also to spur efforts to fight TB and malaria.
By considering the adult population size; annual alcohol and tobacco consumption; the cost of universal access per person per year (which he pegged at a conservative US$861, a figure that includes treatment, diagnostics, and medical care); and the number of people in need of HIV treatment, Hill showed that, for example, in Kenya alone, US$63 million could be raised annually, paying for 73,000 of the 277,000 Kenyans in need of ART.
If the Global Health Charge were raised only marginally higher in the Kenyan model – up to five cents on alcohol, and 25 cents on cigarettes – universal access could be achieved.
With only a one-cent charge on alcohol, and a 10-cent charge on tobacco, universal access could be funded in Nigeria, Uganda, Botswana, Thailand, Vietnam, India, Brazil, Russia, Ukraine, and China. Implementing such a tax in these countries would raise a total of $2.57 billion a year, allowing 3,011,000 patients to be placed on treatment – with money left over for HIV prevention, TB, malaria, and other diseases.
In Nigeria for example, the tax would raise $1.1 billion – enough to cover the cost of treatment for just over one million people, while leaving $223 million to combat TB and malaria.
In Uganda the tax would raise $259 million – enough to cover the cost of treatment for 281,000 people.
In South Africa, a tax of 3 cents on beer and 25 cents on a packet of cigarettes would raise enough to fund universal access to treatment for South Africa’s citizens.
In Cameroun, Ivory Coast, the Democratic Republic of Congo, Kenya, Malawi, Mozambique, South Africa, Tanzania, Zambia and Zimbabwe, the tax would raise a total of $923 million, enough to provide treatment for 35% of the people still in need of it. Higher tax rates would achieve correspondingly greater coverage.
Hill noted that in low- and middle-income countries, which are disproportionately affected by HIV, tax rates on cigarettes are often far below the 70% rate suggested by the World Health Organization. High-income countries, conversely, which face a relatively low burden of HIV, have much higher tax rates: while 79% of high-income countries have tax rates on cigarettes that are at least 50% of the retail price, only 31% of low- and middle-income countries have tax rates of at least 50%.
Hill added that by increasing tax rates, not only could much-needed money be raised for HIV and other public health priorities, but alcohol abuse and cigarette use could be discouraged: in 2010 alone, alcohol and tobacco use together accounted for over 8.5 million deaths.
"People are not just dying of HIV, but they are dying of tobacco in very high numbers, and they're dying of alcohol. A decrease in the consumption of alcohol and tobacco would have associated public health benefits," he said.
Hill noted that other so-called "sin taxes" could be used to fund a myriad of health issues. "We don't want to be accused of AIDS exceptionalism here," he said. "There is an opportunity for other 'sin' taxes to be used for other…diseases."
Hill A, Sawyer W. Funding universal access through a “global health charge” on alcohol and tobacco: feasibility in the 20 countries with the largest HIV epidemics. 19th International AIDS Conference, Washington DC, abstract M0AE0306, 2012.