Press Release

Minister Tim O´Malley opens Seminar on The Economics of Tobacco Control

Mr. Tim O´Malley, T.D., Minister of State at the Department of Health and Children, has today (19 September 2002) delivered the Opening Address at a seminar on The Economics of Tobacco Control and Irish Fiscal Policy which was held at the Royal College of Physicians, Dublin.

This important seminar, which was organised by the Office of Tobacco Control, included presentations on economics, marketing, smuggling and illicit trade, taxation and tobacco and the price index. Participants included international experts on economics, taxation, health officials, politicians, policy makers, physicians, administrators, enforcement officers, marketing experts and agencies and groups with an interest in tobacco control.

“One of the most effective public health instruments in reducing tobacco consumption and, in particular, in preventing children from experimenting with tobacco products are economic interventions, particularly on price control,” said the Minister.

Both the World Health Organisation and the World Bank have recommended high prices as being very effective in curbing tobacco consumption. According to the World Bank´s 1999 Report Curbing the Epidemic, a price increase of 10% can reduce demand for tobacco products by about 4% in high-income countries and by about 8% in low-income countries.

In Ireland price control of tobacco products is used as a public health instrument. Prices of tobacco products are kept high with almost 80% of the cost of a packet of cigarettes being taxes. A side effect of this measure has been the impact on the Consumer Price Index (CPI) of substantial tobacco price increases and consequent inflation rates. Increases in tobacco products are included in the list of goods and services used in compiling the CPI.

“This is an issue which must be dealt with if we are to retain high tobacco prices as an effective public health instrument. Removal of tobacco products from the CPI is necessary and the Government is committed to reaching agreement on this with the employers´ organisations and the trade unions. Additional revenue raised through tobacco taxes can be used in the treatment and prevention of cancer, heart disease and other tobacco-related diseases,” added the Minister.