INTRODUCTION
Research context
1.1.1.The consumption of unhealthy commodities in Vietnam and its impacts
The excessive consumption of alcohol, tobacco and sugar-sweetened beverage (SSB) causes serious problem for human health The 2018 World Health Organization(WHO) reports that alcohol result-ed in approximately 3 million deaths and 132.6 million disability-adjusted life years worldwide in 2016 Tobacco was blamed for the death of around six million people each year including 600,000 whose suspected cause of deaths is second-hand smoking Besides being blamed for ill-health, disability and death from non-communicable diseases, tobacco is also associated with the risks of communicable diseases (WHO, 2015) Meanwhile, Malik, Pan, Willett, & Hu (2013) affirmed that SSB promotes weight gain in children and adults Alcohol, tobacco and SSB, in this study are referred to as unhealthy commodities
Recently, the consumption of unhealthy commodities in Vietnam is becoming more serious Data of WHO (2018a) shows that the alcohol per capita consumption of Vietnam increased steadily since 1991, from only 0.16 liters of pure alcohol 1 per person per year in this year to 3.1 liters in 2016 According to Pham, Tran & Tran (2018), the proportion of adults drinking in Vietnam raised from 46% to 77% among men and 2% to 11% among women between 2002 and 2016 In 2017, Vietnamese consumed 305 million liters of alcohol and 4.1 billion liters of beer, ranking first in Southeast Asia region and ranked third in Asia, just after Japan and China (WHO, 2018b)
The ratio of male smoker in Vietnam is very high (46%) compared to Japan (33.7%) and global average (33.7%)
According to the Vietnam Household’s Living Standard Survey (VHLSS)
2010, 2014 and 2016 of the Vietnam General Statistic Office (GSO), the average
1 Pure alcohol is a common unit to measure the alcohol consumption 25 g pure alcohol is defined as 750 ml beer, 75 g low-alcohol liquor, 50 g hard liquor, and 250 ml wine (Huang, Liu, Li, Xu, & Jia, 2017) consumption of SSB per households over 2010-2016 was increasing In 2010, each household in Vietnam consumed only 151.42 liters of SSB per year, the consumption increased to 185.38 and 189.14 liters in 2014 and 2016 respectively
Figure 1.1 illustrates the ratio of obesity among adults in Vietnam over 1976-2016 which observed a steady increase in recent 10 years From 2006 to 2016, the ratio of obesity among adults in Vietnam has increased from only 0.6% to 2.1%
Figure 1.1: Ratio of obesity (BMI≥ 30) among adults in Vietnam, 1976-2016, (%) Source: author’s calculation based on Global Health Observatory data of WHO (2018)
The above descriptive data portrays the serious situation of the consumption of unhealthy commodities and its serious consequences in Vietnam in recent years
It urgently requires the society and government to review its policies to direct Vietnamese consumers toward a healthier consumption habit
1.1.2 The role of excise tax in reducing the consumption of unhealthy commodities and history of excise tax in Vietnam
Among many measures to control the consumption of unhealthy commodities, taxation policies are considered strongly effective Many previous studies have already proved the effectiveness of unhealthy commodity taxation Koski, Sirén, Vuori, & Poikolaine (2007) and J.Cook & Moore (1994) affirmed that alcohol tax had significant impact in reducing drinking prevalence, traffic fatalities, robbery rate and increasing college graduation among the youth Zhang, Cohen, & Ferrence
(2006) and Keeler, Barnett, & Manning (1993) said that tobacco tax supported to reduce tobacco consumption and number of smokers Meanwhile, Andreyava, Chaloupka, & D.Brownell (2011) and Wang, Coxson, Shen, Goldman, & Bibblins-
Domingo (2012) stated that SSB taxation would support to reduce consumption, improve SSB-related diseases, reduce medical cost and generate state budget revenue
The tax on unhealthy commodities is usually brought in to excise tax laws due to the fact that one of the key objectives of this tax is to direct consumer’s behavior towards heathier lifestyle
In Vietnam, taxation on tobacco and alcohol was first imposed when the Excise Tax Law was implemented in 2008 In 2014, the tax rates for these 2 commodities were increased In 2017, in the frameworks of the Government’s program to re-structure the state budget revenue, the Ministry of Finance (MOF) proposed to bring SSB to the list of taxable commodities and increase the tax rate for tobacco Many social activists from Oxfam, Health Bridge and WHO suggested to not only impose new tax on SSB and increase tobacco tax rate but also increase tax rate on alcohol Table 1.1 bellow summarizes the history of excise tax in Vietnam since 2008
Table 1.1: History of excise tax in Vietnam
Tax rate on Wine>20 o Wine