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Tuesday, Sep. 27, 2011
Health side of tobacco tax
Health and welfare minister Yoko Komiyama on Sept. 9 said that the price of a pack of cigarettes should be raised ¥100 each year to around ¥700 at least and the jurisdiction of tobacco-related administration should be transferred from the Finance Ministry to her ministry.
Finance Minister Jun Azumi reacted strongly by saying that he never thought of raising cigarette prices. He also insisted that the jurisdiction belonged to him.
In October 2010, the tobacco tax was raised by ¥3.5 per cigarette. Thus the price of Mild Seven, a popular cigarette brand of Japan Tobacco Inc., rose from ¥300 to ¥410 per pack. The tobacco tax brings a yearly revenue of more than ¥2 trillion. There is a fear that the price raises may reduce the revenue.
To raise funds for reconstruction from the March 11 quake and tsunami, the government has an option of raising the tobacco tax, in addition to raising the income and corporate taxes. To help raise the funds and to increase managerial freedom, Japan Tobacco proposed to the government that it sell its 5 million JT shares, which accounts for 50 percent of all the JT shares, saying that it will bring a revenue of some ¥1.7 trillion.
But discussions on cigarette prices should not be detracted from discussions on health damage from smoking and passive smoking and on how to minimize such damage. Smoking can cause lung cancer, chronic obstructive pulmonary disease and cardiac and cerebral infarction.
According to statistics of the World Health Organization, smoking yearly causes nearly 6 million deaths worldwide, 600,000 of them from passive smoking. If effective countermeasures are not taken, the deaths can reach 8 million a year by 2030, the WHO warns. It also says that in 2010, 31 countries had laws banning smoking in almost all public spaces, an increase of 16 countries from 2008.
In Japan, a complete ban on smoking is in force only at about 20 percent of all work places. The Japan Society for Tobacco Control has proposed that the price of a pack of cigarettes be raised to ¥1,000, saying that this would help deter minors from starting the habit of smoking. It also called on Prime Minister Yoshihiko Noda, a heavy smoker, to quit smoking as the duty of a national leader. The government should enlighten people more about health damage from smoking and how much such damage costs them and the nation.