The launching of the Bloomberg/Gates Foundations report on the Economics of Tobacco Control in the Russian Federation was held on April 21, 2009, at the World Bank Office in Moscow. The World Bank and the World Health Organization cosponsored this event with the Health Committee of the State Duma (Russian Parliament) and the Campaign for Tobacco-Free Kids. The event was chaired by Patricio Marquez, Lead Health Specialist, Europe and Central Asia, The World Bank.
Nikolai Fyodorovich Gerasimenko, First Vice Chair of the Health Committee of the State Duma made a presentation in support of the recommendations to increase taxes on cigarettes as one of the most effective measures to deal with the smoking epidemic in Russia. Also, Deputy Alexandrovich Markov, Vice-Chair, State Duma Committee on NGOs and Religious organizations, and Deputy Liudmila Stebenkova, Chairman of the Commission on Health and Public Health Protection of the Moscow City Council, made statements endorsing the recommendations of the report.
Key points made by Patricio Marquez, Lead Health Specialist, ECA, at the opening of the Conference:
Scientific evidence and country experiences, particularly G8 countries, indicated that increases in the taxation of tobacco products, along with regulations to prevent smoking in public places (such as restaurants) and advertisement of tobacco products, are the most cost effective measures to deal with the smoking epidemic in the world and reduce mortality associated with lung cancer, heart attacks, and chronic obstructive respiratory diseases (e.g. in Australia, after the introduction of tobacco control measures the mortality levels due to some of these diseases was reduced to levels seen in the 1950's and early 1960's; same trends observed in the US, Canada and UK over the last 15 years).
These measures also make sense from an economic perspective, particularly in periods in fiscal crisis. A good international example is the recent decision in February 2009 by US President Obama and the US Congress authorizing the renewal and extension of the Children’s Health Insurance Program (Chipra) for poor children by increasing the taxes of cigarettes to fully fund the program. It is expected that the program will cover 4.1 million more low-income, uninsured children, in addition to the 7 million children currently enrolled in the next 4 years.
Indeed, CHIPRA would increase funding for children’s coverage through Medicaid and CHIP by about US$33 billion over the CHIP baseline levels of US$25 billion from 2009 through 2013 using a 62-cent per-pack increase in the federal cigarette taxes and other tobacco tax increases to finance the new spending.
In Russia there is plenty of room to increase the taxes on cigarettes as the average price of a pack of cigarettes in Moscow for example is less than US$2 as compared to the prices in other cities that range from US$12.95 in New York, US$13.10 in Syndey, US$13.35 in Wellington, US$14.60 in Toronto, US$16.80 in London, and US$19.30 in Dublin. Most of the high cost in these cities is taxes (about 70% of the price).