Taxation with Amelioration

The world can learn from Moldova’s tobacco tax, says World Bank’s Patricio V. Marquez. 30% of Moldovan men smoke and the workforce suffered in recent years from premature mortality rates tied to noncommunicable diseases—to which tobacco is a major contributor.

Since 2016, hiking tobacco taxes has proved beneficial both for Moldova and its poorest residents—low-income smokers are quicker to cut back, resulting in more cash in pockets and fewer work days lost to tobacco-related illnesses. To compound successes, countries should consider unifying tax rates across tobacco products, adjusting rates continually to outpace inflation, and coordinating with neighboring countries to reduce smuggling, writes Marquez.

World Bank

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