Proposed changes to have Kenya’s ambitious Universal Health Coverage (UHC) kitty partly funded through ring-fenced taxes are not enough. More options need to be on the table to ensure adequacy of funds.
The traditional sin taxes on cigarettes and beer aimed at punishing addictive consumptive behaviour haven’t really worked and extra funds from their taxation could contribute to our desired health promotion goals of reducing their use while also ensuring a specific source to fund our interventions.
Further to these two sources, what other options do we have?
The elements of a good sin tax are that it targets non-essential expenditure and capturing as many “offenders” as possible. Here what comes quickly to mind is gambling as a new health sin tax, because, it too is addictively destructive.
Though now amended, the 2017 proposed betting tax regime repeal has short-changed us.
According to a Geopoll survey on Africa, Kenya is the third largest market of regularly gambling youth, smaller only to South Africa and Nigeria despite their relatively larger populations and bigger economies. With ongoing trends, where more people gain access to online gambling, this number will rise.
What are the gambling statistics locally?
Projected growth will be driven by rural dwellers and urban poor in the lower three wealth and income quintiles. These same groups are often uninsured health wise and rely on State subsidised medical care. It would also be interesting to analyse how winners spend their funds.
Here’s the fallacy of the situation: the average gambler lacks health insurance, but may spend Sh500 that could pay his or her NHIF monthly premium. For gullible populations, the hope of winning even against badly tilted odds lures many to use funds for school fees, food, rent, utility bills for gambling.
Aided by a shift in betting models, former investments in human resource, previously necessary to run gambling operations, are no longer necessary. The result is that revenues and earnings may be higher, drawing new operators in the local betting market.
One often cited weakness of health interventions is lack of public health awareness and there are two ways in which we could fund this. Cigarettes and alcohol manufacturers market their products far much better than we do health promotion. From Waiyaki Way down Mombasa Road for instance, only one of 96 billboards counted had a health message.
Similarly, combined betting firms’ billboards and signposts came second only to the telco’s. Could taxing such advertisements generate revenue to fund our health education billboards? The proposal is that a percentage of such adverts go towards healthy behaviour targeted advertisements.
The final source is a new tax equivalent to 10 per cent levied on “faith based” hospitals presently exempt. Instead of offering a percentage of their services to charity, an equivalent amount should be deducted then used to pay for NHIF for vulnerable groups and indigents. This is more beneficial to society