Tobacco kills more than 8 million people globally every year. More than 7 million of these deaths are from direct tobacco use and around 1.2 million are due to non-smokers being exposed to second-hand smoke.
The prevalence of tobacco use in Indonesia is extremely high. The country is home to 60.8 million adult male smokers and 3.7 million adult female smokers, and the use of tobacco among youth has been steadily on the rise in recent years.
Looking ahead to 2024, the Government of Indonesia is focused on improving the wellbeing of Indonesians, investing in human capital development for better productivity and all-inclusive economic growth. Considering this, as part of the World Health Organization’s commitment to support Indonesia, WHO has facilitated a review on the impact of tobacco use on Indonesia’s economy.
The review, titled ‘Raising Tobacco Taxes and Prices for a Healthy and Prosperous Indonesia’, analyzes comprehensive public data and reaffirms that, as one of the major risk factors for noncommunicable diseases, high levels of tobacco use negatively affect the resources available for economic growth in Indonesia in two ways: firstly, the increased burden on noncommunicable disease-related curative care causes significant additional fiscal strain on national and individual spending on healthcare, and secondly, the premature morbidity and mortality resulting from tobacco use directly reduces the productivity of the workforce through absenteeism and lower outputs.
The review provides key recommendations to reduce tobacco use in Indonesia through fiscal measures − most notably observing that increasing tax by at least 25% annually and simplifying the tobacco tax structure is the most effective way to reduce tobacco use and improve health outcomes, particularly among young people. Reforming tobacco taxation is a win-win solution for Indonesia: a win for public health resulting in a decline in tobacco use, and a win for the economy with more revenue returned to the government and greater workforce productivity.
The review also considers related aspects of employment and agriculture linked to tobacco in Indonesia, and highlights that negative health and economic costs due to tobacco use surpass any perceived economic gains from tobacco.
If increased tobacco taxation and other non-fiscal tobacco control measures are adopted, tobacco use in Indonesia will decline. Concurrently, additional revenue would be directed towards supporting important economic initiatives and the health of the workforce would improve, leading to greater productivity and economic development for the country.
WHO is constantly evaluating new research, and stresses the importance of ethically approved, high-quality, systematic research that will contribute to advancing public health.
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For more information, contact:
WHO Indonesia Communications Team
Email: seinocomm@who.int
Sources of the quoted data are available in the policy review ‘Raising Tobacco Taxes and Prices for a Healthy and Prosperous
Indonesia’.
Raising Tobacco Taxes and Prices for a Healthy and Prosperous Indonesia