March 2008 · Number 119 A regular series of notes highlighting recent lessons emerging from the operational and analytical program of the World Bank`s Latin America and Caribbean Region. 44689 BRAZIL The role of the tobacco control program in curbing smoking Roberto Iglesias, Prabhat Jha, Márcia Pinto, Vera Luiza da Costa e Silva and Joana Godinho Available evidence indicates that there was a significant Porto Alegre and Rio Branco. decline in smoking in Brazil between 1989 and 2006. · Smoking is more concentrated among the uneducated About two decades ago, the government launched a to- groups of thepopulation, which may also be the poor- bacco control program, with a marked acceleration of er. There is a 1.5-2 fold higher prevalence of smoking efforts since 1990, focusing on non-price interventions among those with little or no education as compared such as bans on advertising, restrictions on smoking in to those with more years of schooling. public places and other activities. Although the Brazil · Total cigarette consumption per adult also decreased tobacco control program is considered one of the most significantly, but has stabilized in recent years. Legal comprehensive in the developing world, no formal evalu- and illegal sales of cigarettes decreased from 1,700 ation has been carried out. cigarettes per year in 1990 to 1,175 cigarettes in 2003-2005. A recent study1 assessed the smoking situation in Brazil, · In metropolitan areas, the percentage of households and the role of the tobacco control program, and com- with smokers decreased from 34 percent in 1995-96 pared it to experience in other to 27 percent in 2002-2003. The pro- countries. The study assessed key portion of tobacco expenditures in total trends in smoking rates and lung household expenditures also decreased cancer in Brazil, and reviewed from 3 percent in 1995-96 to 2 percent price and non-price interventions. in 2002-03. A discussion of fiscal instruments · Lung cancer rates during early adult and smuggling is also included in life decreased among males be- the report. tween1980 and 2004, but increased among females, which may be related Evidence gathered by the study to smoking cessation among men, and indicates that in Brazil: increased smoking among women. · Smoking prevalence decreased · From 1996 to 2005, there were over 1 significantly between 1989 and million hospitalizations attributable to 2006. In 2006, about 20 per- smoking. Tobacco-related hospitaliza- cent of males and 13 percent tions cost about US$0.5 billion, or 1.6 of females smoked in the main percent of the hospitalization budget cities. Smoking prevalence between 1996 and 2005. among adults in state capitals ranged from a low of 9.5 per- Even at its peak, in the 1980s, ciga- cent in Bahia to 21.2 percent in rette consumption per capita was 1 Extracted from "Tobacco Control in Brazil" by the same authors. Paper prepared for the World Bank's Human Development Department, Latin America and the Caribbean Region, August 2007. Available at http://www.worldbank.org/hnppublications Table 1. Tobacco Mortality and Total Disability-Adjusted Life Years by Gender and Region 2000 Tobacco Deaths Total DALYs (thousands) (thousands) Region/Gender Males Females Males Females East Asia and Pacific 829 274 13,116 4,128 Europe and Central Asia 754 12,407 2,686 Latin America and the 177 97 2,789 1,613 Caribbean Middle East and North Africa 97 28 1,676 554 South Asia 768 187 12,397 3,285 Sub-Saharan Africa 105 66 1,659 1,091 Low-and middle-income 2,730 813 44,044 13,357 High-income 929 548 12,304 6,866 World 3,659 1,361 56,347 20,222 Source: Ezzati and Lopez 2003; DCPP website. DALY = disability-adjusted life year. always much lower in Brazil than in OECD countries such as the US, Canada, France, Germany, and Italy Smoking and Tobacco Control in the World (Table 1). Brazil smoking prevalence rates and ciga- rette consumption among adults have also been lower Tobacco smoking is a leading cause of death worldwide. than those in several neighboring countries, which Until recently, the epidemic of chronic disease and prema- may be the result of domestic tobacco control policies ture death due to tobacco mainly affected rich countries, implemented in the 1990s. However, consumption has but it is rapidly shifting to the developing world. Smoking remained stable in Brazil in recent years, while it is was estimated to kill nearly 5 million people annually by 200013, accounting for 1 in 10 adult deaths globally14. lower and continues to decline in Chile. About half of those deaths were in low-income countries. In 2000, tobacco accounted for 1 in every 5 male deaths, The Brazil tobacco control program has been very in- and 1 in 20 female deaths, over age 30. Males accounted novative, and is considered best practice on advertising for 3.7 million deaths, or 72 percent of all tobacco deaths. bans and warning labels ­ for example, Brazil was the About 60 percent of male deaths and 40 percent of female first country to ban misleading descriptors such as light deaths due to tobacco were of middle-aged people (35-69 and mild from cigarette packages ­ but it has mainly years). focused on non-price instruments. These have included bans on tobacco advertising and smoking in public The 20th century saw 100 million tobacco deaths, most transportation; regulation of tobacco products, such as of them in developed countries and the former socialist limiting the levels of tar, nicotine and carbon monox- economies. On current smoking patterns, annual tobacco ide in cigarettes, and including severe warnings and deaths will rise to 10 million by 2030. The 21st century is images on cigarette packages and tobacco products; likely to see 1 billion tobacco deaths, most of them in low- and launching awareness and education campaigns. income countries. In addition, the program developed surveillance and monitoring initiatives; built institutional capacity; and Indirect estimates suggest that some 300,000 people decentralized tobacco control initiatives to states and died from smoking in the Latin American and Caribbean municipalities. region in 2000, making it a more important cause of death than HIV/AIDS and TB combined. The specific numbers The government has already complied with many of deaths from tobacco and of total disability-adjusted life provisions of the WHO Framework Convention on years (DALYs) by gender and region show that smoking Tobacco Control (FCTC), which was signed in 2003 accounted for about 12-14 percent of all adult deaths in and ratified in 2005. However, to be in full compliance - 4 - the region 2 · March 2008 · Number 119 with the treaty's provisions, the gov- Figure 1 - Legal Consumption per Adult, Real Disposable Income per Capita, and ernment needs to take additional steps, Cigarette Real Price in Brazil 1991 - 2005 including raising tobacco taxes. Indexes (1993.4=100) Price instruments have been used only indirectly, with higher taxes be- ing implemented for fiscal reasons. Even in the context of illegal sales, higher tobacco taxes reduced con- sumption and increased government revenue in the 1990s. Between 1990 and 1993, the price of cigarettes ex- perienced a real increase of almost 78 percent, despite high inflation rates. The increase in price contrib- uted significantly to the observed decline in overall consumption. To- bacco specific tax collection grew 23 percent at constant 2005 values, between 1992 and 1996, despite a reduction of legal consumption per adult of 15 percent in this period. Due to lower taxes, the real price of cigarettes in 2005 was lower than Sources: Secretary of Federal Revenue, IBGE and External Trade Secretary. the average real price in the period mature death among the 21 million current smokers. 1992-98 (Figure 1). The percentage of retail price due to However, to achieve sustainable reductions in prema- the specific tobacco tax (IPI) decreased from nearly 40 ture death and disease due to tobacco, Brazil should percent to 20 percent between 1993 and 2004. However, continue to invest on its comprehensive control pro- the price decline in the period 1998-2001 did not lead to gram and focus both on avoidance of initiation and on a commensurate increase in smoking, which may have cessation efforts, which are central to preventing mil- been due to the impact of non-price instruments over de- lions of deaths. mand. More emphasis should be placed on the revitalization Brazil has established a network of state and municipal of the state and municipal tobacco control network, focal points and programs in major cities of the country. which has received less attention and funds from the This network started to bring and adapt tobacco control federal government. Further reductions in smoking actions and regulations to the local level, creating the prevalence and increases in smoking cessation require necessary instruments to advance tobacco control at com- financing and strengthening of the state and munici- munity level. However, this network has been weakened pal tobacco control programs. State health secretaries in recent years, as the mechanism formerly used by the should resume annual meetings to plan activities and National Cancer Institute (INCA) to transfer funds to review strategies and policies, as well as training ac- states and municipalities from the federal level is no lon- tivities. State and municipal coordinators require more ger available, and no other mechanism has replaced it. support from the Ministry of Health for the implemen- tation of decentralized programs. There is also demand Recommendations for scaling up the smoking cessation program, which Brazil has laid a strong foundation for unprecedented requires staff training and provision of cessation aids, public health gain. Tobacco control in the country has as well as coordination of the national tobacco control been effective. Modest additional action could yield program with the Unified Health System. substantial additional health gains by preventing pre- March 2008 · Number 119 · Price instruments may be used far more effectively, to tion. Policies to fight the illegal market should reduce the build on the substantial program that has been imple- demand for illegal cigarettes through counter-propagan- mented based on non-price instruments. Tobacco taxes da; increase the probability of smugglers being caught are the most cost-effective instrument to reduce cigarette and the severity of their punishment through greater consumption while increasing public revenue due to the control and enforcement of the law; and adopt excise and low price elasticity of cigarette demand. It is at least par- value-added taxes that are paired with anti-smuggling adoxical that a country such as Brazil, with a high pub- technologies, including product tracing and use of promi- lic debt to GDP ratio, spends public money on tobacco nent tax stamps with warning labels in local language, control measures without and enhanced punishment of effectively using price and illegal street sales. tax instruments to curb smoking. Returning to the Finally, effective monitor- prices and taxes practiced ing of the tobacco epidemic in the mid 1990s would is needed. Reliable surveys boost public revenue and of smoking prevalence and public health gains. cessation, and studies of the impact of smoking on mor- The study found that a tality are necessary. Studies 10 percent increase in on consequences of smoking smoking restrictions (legal would complement the find- and other restrictions), ings from smoking prevalence would reduce consump- and consumption surveys. tion by 2.3 percent in the long-term; a 10 percent price Reliable monitoring of smoking mortality should docu- increase would reduce consumption by about 4.8 percent ment the often unexpected hazards of various types of in the long-term. The study shows that an increase of 72 tobacco use, to maintain public support for regulating percent in the cigarette specific tax (IPI) would increase tobacco and evaluate control programs. Innovations such prices by about 14 percent, decrease consumption per as including information on smoking habits in death cer- adult 7 percent, and increase fiscal income from tobacco tificates could also be considered. by 60 percent. A specific recommendation is twofold: · In the short-term, return to the 1993 real price of Econometric studies, such as those included in this re- cigarettes. This would involve an increase of 23 per- port, may contribute to appraise policy impact on public cent of the 2005 average price, or an increase of 118 health. Analyzes of costs of smoking to households, percent on the 2005 average rate of IPI tax. In 2005 health system, labor market and the economy, as well as prices, this would result on an average street price of the impact of price and tax increases on smoking habits R$2.72 (about US$1.36). Such increase would reduce and burden of disease, would provide useful contribu- consumption by about 11 percent or about 100 legal tions for further development of public policy in this cigarettes per capita per year. area. · In the longer-term, raise the percentage of retail price that comes from the IPI tax from about 20 About the Authors percent to about 40 percent. Roberto Iglesias is an Economist and Lecturer at the Catholic University of Rio de Janeiro, Director of the In conjunction with tax increases, the government Center for Studies on Integration and Development should continue to counter illegal sales of cigarettes. As (CINDES). Prabhat Jha is Professor, Centre for Global part of the 2000 Health Act, Brazil established a national Health Research, St. Michael's Hospital, University of register of importers, exporters and producers of tobacco Toronto. Márcia Pinto, is a Health Researcher, Oswaldo Cruz Foundation. Vera Luiza da Costa e Silva is a products for fiscal purposes, and strengthened controls Senior Public Health Specialist, Consultant, Surveillance on the marketing of cigarettes through the use of control Secretariat, Brazil Ministry of Health. Joana Godinho is a stamps and production of counting equipment in produc- Senior Health Specialist with the World Bank. "en breve" is produced by the Knowledge and Learning Team of the Operations Services Department of the Latin America and the Caribbean Region of the World Bank - http://www.worldbank.org/lac · March 2008 · Number 119