Making money is more important than health

BALANCING INTERESTS: THE ECONOMICS OF TOBACCO CONTROL IN CHINA By Teh-wei Hu

Government officials in the Ministry of Health and public health professionals in China have recognized the severity of the negative health impacts of smoking and have made efforts to discourage cigarette smoking through public health campaigns. To date, however, an important and effective tobacco control policy—increasing the tobacco tax—has not been adopted due to strong resistance from top officials in the Ministries of Commerce and Finance. Officials in these ministries fear that an increase of the tobacco tax would lead to a decrease in cigarette consumption, thereby reducing a major source of income for tobacco farmers, especially in the poor southwest regions, and more critically, lead to a loss of employment in the cigarette manufacturing industry and a loss of government revenue. Given that the industry produces 1.7 trillion cigarettes annually, the government believes that any decrease in tobacco consumption would also lead to a decrease in a major source of revenue for the central government... Beijing is therefore facing a policy dilemma over the conflict between its public health concerns and its needs to maintain a significant source of government revenue.