世界发展银行-Health-Earmarks-and-Health-Taxes---What-Do-We-Know-_7页_667kb

Summary of "Health Earmarks and Health Taxes: What Do We Know?"

Core Content

This document explores the concepts of health earmarking and health taxes, analyzing their role in health financing and fiscal resilience, particularly in the context of COVID-19. It highlights the trade-offs between revenue generation, equity, and policy flexibility, while drawing on country experiences and global evidence to inform best practices.

Main Points

1. What is Earmarking for Health?

• Definition: Earmarking involves allocating a portion or all of tax revenue to a specific purpose, such as health.
• Types:
  • Hard earmarking: Taxes are allocated based on fixed rules, bypassing the standard budget process. This can limit government flexibility and create fiscal risk.
  • Soft earmarking: Aligns with standard budget processes, allowing for adjustments and transfers between funds. It is generally less risky and more politically feasible.

2. Global Use of Earmarking and Health Taxes

• At least 80 countries use health earmarking, but many more use health taxes.
• Health taxes (e.g., on tobacco, alcohol, and sugar-sweetened beverages) aim to improve population health and generate revenue, but they do not inherently increase health funding.
• Earmarking is often used to direct revenue toward health, but it may reduce overall health funding due to fungibility (revenue can be reallocated).

3. Benefits and Risks of Earmarking

• Benefits:
  • Can increase transparency and public support for health initiatives.
  • May align with political priorities and improve accountability.
  • Useful in fiscal constraints, such as during the pandemic, to provide short-term funding.
• Risks:
  • Budget rigidity and economic distortion.
  • Fragmentation of the health system.
  • Regression and inequity in some cases.
  • Susceptibility to special interest groups and political shifts.

4. Key Lessons from Country Experiences

• Short-term gains from earmarking are often offset by long-term reductions in other revenue sources.
• Narrow expenditure purposes are more enforceable, but flexibility is important to avoid rigidity.
• Political alignment between health and finance stakeholders is crucial for successful implementation.
• Sunset clauses and periodic reviews help ensure that earmarks remain relevant and effective.
• Soft earmarking is recommended over hard earmarking due to its flexibility and alignment with standard budget processes.

5. Role of Health Taxes in Pandemic Resilience

• Health taxes can generate revenue and reduce consumption of harmful products.
• They may reduce the burden on health systems and manage disease risk factors (e.g., smoking, alcohol use).
• In low- and middle-income countries, health taxes can be a viable option for rebuilding health systems post-pandemic.
• However, without reprocisitization, health financing may stagnate or decline.

6. Case Studies

• Philippines:
  • Implemented soft earmarking for Universal Health Coverage (UHC).
  • Taxes on alcohol and tobacco were increased, with 85% of incremental revenue earmarked for health.
  • Earmarking was expanded in 2019 to include SSB, heated tobacco, and vaping.
  • This led to a tripling of health resources over five years and reduced smoking prevalence.
• South Africa:
  • Has implemented excise taxes on tobacco, alcohol, and SSB.
  • No earmarking of health tax revenues.
  • Illicit trade claims are overstated by industry, and tax revenue has increased despite bans during lockdowns.
• Thailand:
  • Uses a hard earmark for health tax revenues.
  • A 2% surcharge on tobacco and alcohol excise taxes is directed to the Thai Health Promotion Foundation.
  • Funds are used for prevention programs and health initiatives, with no major opposition to the policy.

Key Information

• Earmarking is not always necessary if the budget process is effective and health is well prioritized.
• Soft earmarking is preferred in most contexts due to its flexibility and alignment with standard budget procedures.
• Health taxes are effective in reducing consumption of unhealthy products and raising revenue.
• Fiscal constraints during the pandemic have amplified the need for smart health financing.
• Earmarking health taxes can inject short-term funding into the health sector, especially if public financial management safeguards are in place.
• Pro-poor considerations are essential when designing health tax and earmarking policies.

Conclusion

Earmarking and health taxes are important tools for health financing, but they must be carefully designed and implemented to avoid rigidities and inequities. Soft earmarking is recommended in most contexts, especially during fiscal crises like the pandemic, to balance flexibility and commitment. Health taxes can be effective in improving public health and generating revenue, but their revenue potential must be analyzed and aligned with broader fiscal goals. Pro-poor and transparent policies are key to ensuring equity and sustainability in health financing.