Excise Progression Might Not Reduce Usage of Alcohol and Cigarettes


The excise on the “sin tax” has been doubled. Thus, over 20 billion MNT is expected to be added to this year’s state budget. This shows the intention to cover the expected deficit from reduced coal exportation with the excise progression. The progression would allow the government to gather the fund to be distributed to fund children’s issues too. Yet, on the other hand, this “Child Money” is likely to benefit the parents and even be used in purchasing alcoholic beverages with the excise. If we look at the excise from this perspective, the intended purpose to reduce the usage of alcohol may even play into the opposite role. Some are criticizing the excise progression, claiming “The Government can’t even collect the tax properly yet now it has doubled the sin tax. This decision wouldn’t bring positive outcome.”
Baabar once stated that “Every new parliament of Mongolia tries to prove its intelligence by adding taxes, though it never reduces alcoholism.”
Out of 66 thousand companies currently registered in the state of Mongolia, only one third of them pays the tax. The combined total of this one third brings 31.2 trillion MNT to the state budget each year. Currently, 15 spirit, 92 vodka, 15 wine, 23 beer manufacturers—or 145 manufacturers in total—are operating with permission in Ulaanbaatar. Even though the government receives excises from all of them, an expected decrease in the usage of alcohol and cigarettes is in doubt.
Though the ‘National Programme on Prevention and Control of Alcoholism’ has been implemented in Mongolia since 2003, the programme has been proven rather inefficient. A working group to monitor the enforcement of the Law on Anti-Alcoholism has been formed recently. The group met the Prime Minister, N.Altankhuyag, last week and decided to terminate the special permissions of operation of those grocery stores and trade centers which have been selling alcoholic beverages to people under the age 21 from October 1. A proposal to establish a dance club for those under the age of 21 who don’t drink alcohol has been submitted to the Prime Minister and 80 percent of the students have supported the idea of an alcohol-free club, according to unofficial research. This is undoubtedly due to the fact that there’s one vodka manufacturer for every 330 people, 1.3 night clubs for every thousand people in Ulaanbaatar and students will have to buy vodka whether they want to stay in a night club these days, though they might not want to. Thus, an excise for the purpose to reduce alcoholism is of little significance.

Below is an interview from Daily News with the head of the Association Against Alcoholism and Drug Abuse (AAADA) of Mongolia, B.Tumendemberel.

-An excise has been added to the “sin tax.” Do you think it will reduce the usage of alcoholic beverages? What’s the opinion of the AAADA?
-The public is responding positively to the excise. In international countries, the usage of alcohol is controlled through their tax policy. But a situation may arise of illegal vodka manufacturing. The public and NGOs have to monitor those manufacturers. But beforehand, the public must be educated about the harm of alcoholic beverages. Without encouraging the proper perception of citizens, any work to reduce alcohol usage is actually impossible only by adding an excise or closing the vodka manufacturers’ doors. Regarding the advice of the World Health Organization for countries with a high usage of alcohol, the first step to take is a proper policy on the “sin tax.” Thus, Mongolia has started implementing the first step. The second step would be thorough control and monitoring, while the third would be taking steps to relieve the drinking addiction of alcoholics and to recover their health with scientifically proven treatments and to provide the proper knowledge of alcohol to the public.
-The Government must organize public-oriented projects apart from adding an excise to reduce alcohol usage. How many projects are getting implemented in Mongolia?
-Many NGOs which work in this area are coming out lately. Some 30 organizations have united and established the National Union on Reducing the Harm of Alcoholism. The aim of this is to operate in united fashion and to bring about more benefits. Instead of claiming that alcoholism is getting out of hand on TV, we are organizing a project to jointly enhance the legal environment in conjunction with policy makers. There’s a survey which have proven youth are starting to drink alcohol early. If knowledge about alcoholism and its harm was taught to students at school, our work would be easier and more efficient.
-What is the result of current treatment of alcoholics?
-Out of ten alcoholics undergoing treatment, two to three of them are able to get help with their addiction. Alcoholism is a mental health issue. Mental health treatment requires numerous personnel and a long time. Due to the experience of foreign countries, an alcoholic who hasn’t used alcoholic beverages for 24 months or two years is considered as fully recovered. But Mongolian hospitals are counting every person who has received alcoholic treatment as recovered while it’s only possible to know whether they have given up their addiction after two years have passed.
Our organization has been operating for 13 years now and therefore we have interviewed various people which has proven that the outcome of treatment for alcoholics is very poor. To obtain a better result, more funding and personnel are needed. According to international standards, effective treatment of alcoholics must cover at least 90 days, followed by a two year outpatient treatment. Whereas in Mongolia, only 14 days of hospitalization is used—putting in drips and relieving alcoholism poisoning.
-How many people are there who need urgent treatment for alcoholism in Mongolia?
-The alcoholism is widespread in our country. The Ministry of Health, the National Centre of Mental Health and our organization conducted joint research on the spread of alcoholism in 2006. This showed that 14.2 percent of every ten thousand people were alcoholics at that time. Though there’s no recent research, the usage of alcoholic beverages has decreased, compared to the past.

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