Minister Chiwenga proposed the tax increase ahead of the 2022 national budget. The Ministry of Health has been heavily drained grappling with the COVID-19 pandemic. The tax increase is proposed to raise funds to finance healthcare services.
According to News Day, Minister Chiwenga also responded to issues raised by the public during countrywide public consultations on the 2022 budget who had told the Parliamentary Portfolio Committee on Health that Finance Minister Mthuli Ncube should increase allocations of the health levy from 5% to 10% of the 2022 budget.
The COVID-19 pandemic saw alcohol harm rise in Zimbabwe. Despite the government instituting better alcohol availability rules to curb the spread of the virus, alcohol sales increased amidst the pandemic. Delta, Zimbabwe’s Big Alcohol giant, recorded a 20% increase in beer sales for the nine months ending September 30, 2020 compared to the same time period in 2019. Sales increased by a massive 48% for the three months ending December 31, 2020 compared to the same time period in 2019.
Young people are especially at risk from growing alcohol harm. A recent report titled “Mental Health Among Young People in the African Region” by the World Health Organisation (WHO) in Africa found Zimbabwe had one of the highest binge alcohol use rates among 15 to 19 year olds in the region. The rate is 70.7% for males and 55.5% for females.
Alcohol tax – a triple win solution
Movendi International supports the development and implementation of public health oriented alcohol taxation such as proposed by Minister Chiwenga, as a key policy solution to achieve health and development for all.
- An innovative illustration depicts, for instance, the benefits of alcohol taxation across multiple Sustainable Development Goals; and
- Offers insights into the potential of alcohol taxation’s critical role to build sustainable health systems and achieve universal health coverage.
Movendi International’s 2015 report on alcohol taxation concluded: Alcohol taxation is a triple-win measure for increasing fiscal space, boosting health promotion and financing sustainable development.
Towards evidence-based, public health-oriented alcohol taxation
Minister Chiwenga implored the Ministry of Finance and Economic Development to abide by the Abuja Declaration’s recommendation to set aside 15% of the national budget for health services. Strengthening the health system is a critical element to help achieve Zimbabwe’s National Development Strategy.
It is our sincere plea that the Ministry should prioritise allocating more funding to the health sector which has proved to be the backbone of the economy. … if the nation is not healthy, we cannot grow, we cannot develop,” said the Vice President and Minister of Health Dr Chiwenga, as per Infinite Health.Dr. Constantino Chiwenga, Vice President and Health Minister, Zimbabwe
With regard to alcohol, a certain number of bottles should contribute to financing of healthcare services. I am saying we cannot collect a two percent tax from non-users of these things, so if we can take a cent from every bottle of alcohol and it goes to national health services, it will help.”
Minister Chiwenga explained the additional domestic resources from alcohol and tobacco taxation would make crucial contributions to reducing the burden of cancer and other diseases. Domestic resource mobilization, in addition to achieving the public health and development goals of the country, is an important additional benefit of alcohol and tobacco taxation because Zimbabwe’s health sector had been heavily dependent on donor funding, according to the Vice president.
Minister Chiwenga outlined expectations that generated revenue from alcohol and tobacco taxes would help fund the construction of health facilities and mobile clinics around the country, as well as free mental health treatment. Improving mental health services was particularly important at a time when alcohol and other drug use problems are rising, especially affecting Zimbabwean youth.
Communities and experts advocate for alcohol and tobacco taxation
In Zimbabwe, in the current national budget there is an excise duty component on alcohol and cigarette imports. However, this tax does not extend to purchase prices.
The draft National Alcohol Policy from 2010 included a provision to change the current tax system to tax alcohol according to the amount of pure alcohol content in a product. The higher the content the higher the tax. However, since the cabinet took the decision to revive the policy in September 2017 there has been no new updates.
Increasing taxes on alcohol and health harmful commodities can improve the health of Zimbabweans.
One of the most innovative ways through which the Government can expand fiscal space for health is to raise additional tax revenue by improving tax collection, including the introduction or increase in [taxes] on tobacco, alcohol, sugary drinks and oily fast foods,” said Mr. Itai Rusike, executive director for the Community Working Group on Health, as per The Sunday Mail.
Mr. Itai Rusike, executive director for the Community Working Group on Health
Mr. Rusike believes that increasing taxes is the way to go to achieve SDG 3 of the Agenda 2030 for Sustainable Development. He added that these commodities increase the NCD burden in the country and that it is only right to set aside funds through increased taxation to provide care for NCDs.
The World Health Organization recommends taxation as one of the most cost-effective evidence-based measures to reduce alcohol harm globally.
Mr. Tungamirai Zimonte, founder of Youth against Alcoholism and Drug Dependency (YADD), Coordinator for Southern African Alcohol Policy Alliance (SAAPA) and Movendi International Board member says Zimbabwe can learn from the Thai approach in funding NCD care and a host of other health and social measures through the Thai Health Promotion Fund which is funded from taxes.
A dedicated, independent health promotion fund established through the levy, similar to the Thai Health Promotion Fund. The funds could be used to finance action to reduce HIV, TB, NCDs, road fatalities, violence against women, mental health issues as well as other health and social outcomes severely affected by the products, practices of the tobacco and alcohol industry,” said Mr. Tungamirai Zimonte, founder of Youth against Alcoholism and Drug Dependency (YADD), Coordinator for Southern African Alcohol Policy Alliance (SAAPA) and Movendi International Board member, as per The Sunday Mail.
Mr. Tungamirai Zimonte, founder of Youth against Alcoholism and Drug Dependency (YADD), Coordinator for Southern African Alcohol Policy Alliance (SAAPA) and Movendi International Board member
[This article was edited on November 15, 2021 as per new information from The Sunday Mail.]