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Simulating the impact of excise taxation for disease prevention in low-income and middle-income countries: an application to South Africa
  1. Nicholas Stacey1,
  2. Amit Summan2,
  3. Aviva Tugendhaft1,
  4. Ramanan Laxminarayan2,
  5. Karen Hofman1
  1. 1Priority Cost Effective Lessons for Systems Strengthening, School of Public Health, Faculty of Health Sciences, University of the Witwatersrand, Johannesburg, South Africa
  2. 2Center for Disease Dynamics Economics and Policy, Washington, District of Columbia, USA
  1. Correspondence to Nicholas Stacey; nick.stacey{at}wits.ac.za

Abstract

Introduction Excise taxes are policy tools that have been applied internationally with some success to reduce consumption of products adversely impacting population health including tobacco, alcohol and increasingly junk foods and sugary beverages. As in other low-income and middle-income countries, South Africa faces a growing burden of lifestyle diseases; accordingly we simulate the impact of multiple excise tax interventions in this setting.

Methods We construct a mathematical model to simulate the health and revenue effects of increased excise taxes, which is adaptable to a variety of settings given its limited data requirements. Applying the model to South Africa, we simulate the impact of increased tax rates on tobacco and beer and of the introduction of a tax on sugar-sweetened beverages (SSB). Drawing on surveys of product usage and risk factor prevalence, the model uses a potential impact fraction to simulate the health effects of tax interventions.

Results Adopting an excise rate of 60% on tobacco would result in a gain of 858 923 life-years (95% uncertainty interval (UI) 480 188 to 1 310 329), while adopting an excise rate of 25% on beer would result in a gain of 568 063 life-years (95% UI 412 110 to 775 560) and the adoption of a 20% tax on SSBs would result in a gain of 688 719 life-years (95% UI 321 788 to 1 079 653).

Conclusion More aggressive excise tax policies on tobacco, beer and SSBs in South Africa could result in meaningful improvements in population health and raised revenue.

  • health policy
  • prevention strategies
  • public health

This is an Open Access article distributed in accordance with the terms of the Creative Commons Attribution (CC BY 4.0) license, which permits others to distribute, remix, adapt and build upon this work, for commercial use, provided the original work is properly cited. See: http://creativecommons.org/licenses/by/4.0/

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Footnotes

  • Handling editor Seye Abimbola

  • Contributors NS, AS, AT, RL and KH conceived the study. NS and AS constructed the mathematical model and ran the analyses. NS drafted the initial manuscript, while all coauthors reviewed, edited, and approved the final draft.

  • Funding The study was funded by the Bill and Melinda Gates Foundation (#OPP1098574).

  • Competing interests None declared.

  • Provenance and peer review Not commissioned; externally peer reviewed.

  • Data sharing statement Model files and data available on request.