Equity as a consideration in evaluations of health taxes: a systematic review

Abstract

Background: Taxing harmful products—such as tobacco, sugar, or alcohol—is a valuable way to improve population health. However, it is argued that excise duties on goods are regressive, because the payment burden falls on the poorest people. The extent to which distributional equity is incorporated into evaluations of the (potential or observed) effect of such taxes is unclear. The primary outcome of this systematic review of evaluations investigating taxation on tobacco, sugar-sweetened-beverages (SSBs), or alcohol was the proportion of evaluations that have considered distributional equity. Secondary aims included identifying methods used to incorporate equity, and summarising the reported distributional effects, for both costs and health benefits.

Methods: A literature search was done using three databases: Medline, NHS Economic Evaluation Database, and EconLit. The full list of search terms is included in the appendix. We included studies published in English, from Jan 1, 1946, to May 20, 2019. Studies that did not explicitly quantify both costs and benefits in terms of health were excluded. Two authors independently reviewed each study to determine inclusion. Citation tracking was used to identify remaining studies, and appraisal for risk of bias in included evaluations was done against validated tools. This systematic review was prospectively registered on PROSPERO (CRD42019137409).

Findings: Of 4656 search results, 69 studies were included. 45 combined economic methods with epidemiological modelling. Tobacco was most commonly investigated, with 35 evaluations. Of these 35, 14 (40%) considered distributional equity, with six (27%) of 22 included SSB evaluations doing the same, and none for alcohol. A tobacco tax favoured lower-income groups in the distribution of costs in all 14 evaluations, and for health benefits in eight evaluations. For SSBs, four evaluations found costs to favour low-income groups, with three finding the same distribution for health benefits.

Interpretation: Despite recommendations, evaluations of health taxes do not routinely consider distributional equity. Evaluations for alcohol taxation are particularly weak. Where investigated, the majority of evidence found tobacco taxation to favour low-income groups, but the little evidence for SSBs is mixed. Future evaluations of health taxes must incorporate distributional equity, if they are to be useful to policy makers.