Can sugar taxes be used for financing surgical systems in Nigeria? A mixed-methods political economy analysis

Martilord Ifeanyichi, Cyril Dim, Maeve Bognini, Meskerem Kebede, Darshita Singh, Obinna Onwujekwe, Rachel Hargest and Rocco Friebel

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This study determined the feasibility of investing revenues raised through Nigeria’s sugar-sweetened beverage (SSB) tax of 10 Naira/l to support the implementation of the National, Surgical, Obstetrics, Anaesthesia and Nursing Plan, which aims to strengthen access to surgical care in the country. We conducted a mixed-methods political economy analysis. This included a modelling exercise to predict the revenues from Nigeria’s SSB tax based on its current tax rate over a period of 5 years, and for several scenarios such as a 20% ad valorem tax recommended by the World Health Organization. We performed a gap analysis to explore the differences between fiscal space provided by the tax and the implementation cost of the surgical plan. We conducted qualitative interviews with key stakeholders and performed thematic analyses to identify opportunities and barriers for financing surgery through tax revenues. At its current rate, the SSB tax policy has the potential to generate 35 914 111 USD in year 1, and 189 992 739 USD over 5 years. Compared with the 5-year adjusted surgical plan cost of 20 billion USD, the tax accounts for ∼1% of the investment required. There is a substantial scope for further increases in the tax rate in Nigeria, yielding potential revenues of up to 107 663 315 USD, annually. Despite an existing momentum to improve surgical care, there is no impetus to earmark sugar tax revenues for surgery. Primary healthcare and the prevention and treatment of non-communicable diseases present as the most favoured investment areas. Consensus within the medical community on importance of primary healthcare, along the recent government transition in Nigeria, offers a policy window for promoting a higher SSB tax rate and an adoption of other sin taxes to generate earmarked funds for the healthcare system. Evidence-based advocacy is necessary to promote the benefits from investing into surgery.

Keywords: global surgery; health policy; health financing; innovative financing; Nigeria (search for similar items in EconPapers)
JEL-codes: F3 G3 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2024-06-01
New Economics Papers: this item is included in nep-pub
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Published in Health Policy and Planning, 1, June, 2024, 39(5), pp. 509 - 518. ISSN: 0268-1080

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