Compared to other countries in the region, the retail price of a pack of cigarettes in Vietnam is less than $1, making it easy for people to purchase and contributing to high smoking rates.  

According to Professor Nguyen Van Thuan, Deputy Minister of Health, although Vietnam has seen a gradual decline in traditional cigarette use after over a decade of implementing the Law on Tobacco Harm Prevention, the annual reduction rate is only about 0.5%. Key factors behind the persistent smoking rates include low tobacco taxes, cheap prices, and easy accessibility.  

Vietnam is now urged to develop a roadmap for significantly increasing tobacco taxes to meet the World Health Organization (WHO) recommendation of excise taxes accounting for over 70-75% of retail prices by 2030.  

Currently, excise taxes account for only 38.8% of the retail price in Vietnam, much lower than the WHO target. In addition, the widespread availability of cigarettes exacerbates the challenges of tobacco control.  

According to WHO, a 10% increase in cigarette prices typically reduces smoking rates by about 4% in high-income countries and 5% in middle- and low-income countries. Tax measures are especially effective among youth; a 10% price increase can lead to a reduction in smoking by 10% or more among young people.  

Dr. Tran Thi Hong Minh, Director of the Central Institute for Economic Management, emphasized that in the context of Vietnam facing significant health challenges related to tobacco use, excise taxes are a critical tool for controlling consumption. Besides curbing smoking rates, excise taxes provide a significant source of revenue for the national budget.  

To ensure effective policy implementation, Dr. Minh advocates for comprehensive assessments of the micro-level impacts of taxes on consumers and different population groups.  

WHO recommends Vietnam adopt significant tobacco tax reforms, introducing a fixed tax of at least VND 5,000 per pack by 2026 and gradually increasing it to VND 15,000 by 2030, alongside the current ad valorem tax. This tax increase is deemed necessary to significantly reduce smoking rates, especially among youth who are most sensitive to price changes.  

At a recent ASEAN workshop on tobacco control hosted by the Ministry of Health, Bungon Rithiphaqkdee, Senior Advisor at the Southeast Asia Tobacco Control Alliance (SEATCA), pointed out that Vietnam has not raised its tobacco taxes for many years. Increasing taxes would deliver far more benefits than drawbacks.  

WHO and the World Bank confirm that higher tobacco taxes lead to reduced consumption while increasing tax revenue. Governments can reinvest these revenues into public health initiatives.  

Under Article 6 of the Framework Convention on Tobacco Control, tobacco products must be priced high enough to deter consumption, particularly protecting younger generations.  

"In Vietnam, a bowl of pho costs VND 35,000, the equivalent of two packs of cigarettes. With such low prices, anyone can afford cigarettes, often sacrificing meals to buy two or three packs," said Bungon.  

SEATCA’s research suggests Vietnam should sell cigarettes at over $3 per pack (VND 70,000+). Comparatively, the Philippines proposes $10 per pack, while Indonesia recommends $5.  

The Philippines serves as a successful example for Vietnam to emulate. Since 2013, the Philippines has steadily increased tobacco taxes, reinvesting revenues into public healthcare programs. Smoking rates dropped from 27% to 19.5% within a few years, while tax revenues soared to $2.9 billion by 2022. This demonstrates that tax hikes, coupled with clear implementation plans and reinvestment strategies, can yield significant health and economic benefits.  

Currently, Vietnam consumes 6.24 billion packs of cigarettes annually (with a population of 100 million), generating $716 million in revenue.  

Tobacco use contributes to significant losses, including 108,000 billion VND annually in early deaths and related illnesses, and 49,000 billion VND in spending on cigarettes. Stronger tax policies could alleviate these costs.  

Bungon urges Vietnam to expedite tobacco tax hikes without delay to maximize their impact.