INSUBCONTINENT EXCLUSIVE:
The Alcohol - Drug Information Center (ADIC) claims that due to the 20% increase in alcohol taxes in 2023, alcohol consumption has decreased
7.7 billion in 2023, while cigarette sales have decreased by Rs
521.5 million.The ADIC made this claim issuing a statement regarding the use of alcohol and cigarettes and the increase in taxes.Excerpts of
the statement are below:-Excerpt -Alcohol and cigarettes are not ordinary consumer goods, and their prices should always be maintained at a
level that discourages their purchase
Alcohol use causes nearly 15,000 premature deaths in Sri Lanka each year, while smoking kills nearly 20,000 people annually.In addition to
losing customers.The number of deaths from non-communicable diseases in our country has now increased to 80%
Two of the four main factors affecting non-communicable diseases are smoking and alcohol use
The Surgeon General of the United States federal government issued a special report earlier this year stating that alcohol is a carcinogen
is among the effective policies proposed by the World Health Organization to reduce the harm caused by alcohol and tobacco use
Accordingly, the increase in excise taxes that occurred in January 2025 is also beneficial for the country.The idea that excise taxes can be
used for the development of a country is outdated
Statistics show that the health and economic costs of alcohol and the amount of tax collected from alcohol have not been able to cover the
economic and health costs of alcohol.According to a study conducted by the UNDP in 2022, the economic and health costs of alcohol are 237
recommendations for alcohol control state that a quantitative increase in alcohol taxes is a very effective alcohol control measure that the
government can implement at a low cost.This has also been demonstrated by the recent increase in excise duties in our country
The 20% increase in alcohol taxes in 2023 has reduced alcohol consumption (pure alcohol) by 8.3 million liters and increased the
521.5 million.This increases state excise revenue and reduces consumption
This has a positive impact on several health, economic, and social problems
Therefore, increasing excise taxes is a win-win situation for the country.Furthermore, whenever the price of alcohol increases, alcohol
companies try to create a perception that illegal alcohol will increase
This effort is a tactic used to prevent future tax increases and reduce existing excise taxes, as increasing taxes on legal alcohol will
reduce sales of their products.The harm caused by legal or illegal alcohol is not different, and all types of alcohol have a serious impact
on health.Therefore, the government should formulate a formal program to control illegal alcohol, effectively enforce the law to control
illegal alcohol, and reduce the use of legal alcohol by increasing excise taxes, reducing the ease of obtaining alcohol, and preventing
methods that lead children and youth to use alcohol.Furthermore, when increasing excise taxes, it should be done through a scientific tax
Until 2009, the government had the full or most of the advantage in levying excise duty on cigarettes
Before 2009, the maximum tax increase was made by considering the market, demand, inflation, and price elasticity when determining excise
duty.Therefore, the opportunity for tobacco companies to set a price on the tax has been minimized
This has enabled the government to obtain the maximum amount of tax that can be collected and has not enriched multinational companies.Thus,
the increase in the profits of tobacco companies, as they receive a large additional profit for their advertising and various interventions,
increases the opportunities for children and youth to become victims of tobacco companies.Although there have been calls for reducing this
situation for many years, the tobacco companies have benefited the most from the tax increase this time.The excise duty on the cigarette
category with the highest sales in the market has increased by Rs
However, its price has increased by Rs
10.The cigarette industry will benefit from the increase in cigarette taxes this time as a proper tax collection system has not yet been
The additional profit that the cigarette industry will receive from this tax increase is approximately Rs
7,000 million.However, based on the current situation, it can be said that whoever comes to power, the tobacco and alcohol companies always
win.Therefore, what people-friendly governments should do is not to increase the income of tobacco and alcohol companies, but to make
healthy, economic decisions that keep the public happy and healthy.For that, it is the responsibility of a people-friendly government to
protect the people by implementing a systematic excise policy.-End of Excerpt -
