A Political Economy Analysis of Health Taxes

Thomas F Babor, Jeff Collin and Maristela G Monteiro

Chapter 15 in Health Taxes:Policy and Practice, 2023, pp 431-484 from World Scientific Publishing Co. Pte. Ltd.

Abstract: Industry sectors involved in the production, distribution, sales and promotion of tobacco, alcohol, unhealthy foods, and sugar-sweetened beverages (SSBs) tend to oppose health taxes because they can decrease the demand for their products and thus reduce shareholder profits. This creates an inherent conflict of interest between the commercial goals of these industries and the public health responsibilities of governments. These industries have become increasingly concentrated into a small number of global corporations that account for a large proportion of the market for these products, especially in low- and middle-income countries (LMIC). There are similarities in the way these products are marketed and purchased, explaining the historical and emerging linkages across industries in how they conduct political activities that influence the policy environment for their products. To illustrate this development, we conducted a broad search for examples of the tactics used by these industries in their treatment of health taxes and pricing policies. Sixty-four documented examples were identified that illustrate how five general corporate political strategies are implemented in a wide variety of countries: (1) using information to gain access to political decision-makers; (2) constituency-building with influential political decision-makers; (3) promoting alternative policies or voluntary measures as substitutes for statutory regulation; (4) using financial incentives to influence government policymakers to act in ways favourable to industry interests; and (5) legal measures employing trade agreements as well as pre-emption, litigation, and circumvention…

Keywords: Health Tax; Health Taxes; Tobacco Tax; Alcohol Tax; Sugary Drinks Tax; SSB Tax; Sugar-Sweetened Beverages Tax; Fiscal Policy; Health; Non-communicable Diseases; NCDs; Health Financing; Public Finance; Public Health (search for similar items in EconPapers)
JEL-codes: I1 I15 K32 (search for similar items in EconPapers)
Date: 2023
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