Ukraine to Raise Taxes on Cigarettes, but Caves to Industry Demands on Heated Tobacco Products
Statement of Smita Baruah, Executive Vice President of Global Programs, Campaign for Tobacco-Free Kids
December 04, 2024
Washington, D.C. – The parliament of Ukraine has passed a new law that will raise taxes on cigarettes – a lifesaving measure that will help drive down smoking rates across Ukraine. The law increases taxes on cigarettes starting in 2025, with continued increases through 2028. Significantly increasing tobacco taxes and price remains the most effective way to reduce tobacco use.
Unfortunately, the new law leaves prices low for heated tobacco products, which are disproportionately used by young people, who are also most sensitive to price increases. According to the Vienna Institute for Economic Studies, this unequal treatment of heated tobacco products forgoes more than UAH 3 billion in revenue and 22,485 premature deaths prevented by 2028.
Tobacco giants like Philip Morris International and front groups like the American Chamber of Commerce spent months aggressively lobbying the government for favorable regulations on addictive tobacco products like IQOS, with many lawmakers ultimately caving to the demands of Big Tobacco. The legislation sets taxes on heated tobacco products some 20 percent lower than cigarettes, which defies best practices in tobacco control policy and puts Ukraine out of step with countries across Europe.
The decision to keep taxes on heated tobacco products low is a loss for the Ukrainian youth using these products at alarming rates and a loss for a government desperately seeking additional revenue sources.
Combined with the aggressive marketing of products like IQOS from companies like Philip Morris, low prices on heated tobacco products will drive more youth to these addictive products. A recent survey found that among tobacco and nicotine users in Ukraine, young people aged 18-29 were the most likely to use heated tobacco products.
The Campaign for Tobacco-Free Kids commends the public health advocates in Ukraine who fought tirelessly to ensure that cigarette taxes would be increased and who faced a tough battle against the world’s largest tobacco companies. Around the world, increased tobacco taxes must urgently be prioritized by governments to curb the global tobacco epidemic. The Ukrainian government must also act urgently to raise taxes on heated tobacco products to the same level as cigarette taxes.