Tobacco Taxation 3, Maldives' smoking and vaping ban

My previous papers on this subject can be considered as Tobacco Taxation 1 and 2:

Tax Cut 39, Tobacco tax rates and illicit trade, August 18, 2023

Tax Cut 40, The P60 B/year question: Who benefits from higher tobacco taxation? May 31, 2024.

Last October 15, Dr Mohamed Muizzu (@MMuizzu), President of the Republic of Maldives, President of Peoples' National Congress (PNC) | PPM-PNC Coalition Leader – Maldives, tweeted this:

This is weird. If the real goal is "tobacco free society" then they should have just prohibited smoking outright. But they just raised the cigarette (a) import tax from 3 Rufiyaa (R) to R8, and (b) advalorem tax by 50%. This implies a partial cigarette ban.

A day before that, President Muizzu tweeted this, then reposted the reaction of WHO:

So it's partial cigarettes prohibition, and total vapes prohibition. How feasible or realistic is Maldives' President in aiming for this?

I created this table, I chose comparable countries with Maldives -- below 1 million in population, per capita income not less than $13,000. Then I checked their cigarette smoking prevalence. See the result.

Rich Europeans that are usually woke and have strict health regulations and high tobacco-alcohol taxes like Luxembourg, Iceland, Malta and Cyprus, their smoking prevalence is not far from Maldives', Cyprus even has higher smoking prevalence than Maldives. 

These countries may have aimed for zero-tobacco or very-low-tobacco-use society but they never succeeded. People smoking, vaping is no different from people doing sky diving, rock climbing, fast downhill cycling, sedentary and couch potato, drinking and partying, etc. -- they do what gives them pleasure without causing harm on other people.

And assuming that higher tobacco tax rates will bring more revenues to government while reducing smoking incidence -- people may be going for disappointment. In the case of the Philippines for instance, as tobacco tax rate increases, government tobacco tax revenues decline. The chart is from my column last June.

https://www.bworldonline.com/opinion/2024/06/06/599851/the-laffer-curve-of-philippine-tobacco-taxation-redux/

Why this is happening -- because many smokers shifted to smuggled and illicit tobacco that are cheap, prices are just 1/4 to 1/2 of legal tobacco. Others have shifted to vape and smuggling incidence here is also high.

Perhaps Maldives' President should reconsider his new policy. People will keep smoking, drinking, vaping, fast downhill cycling, etc. because it gives them pleasure somehow, without harming other people. If legal products are restricted and prohibited, then illegal, illicit products will simply fill in the vacuum, and government loses regulation capacity with regards to tax revenues and product quality monitoring.

Prohibitions will not work. High taxation supposedly to discourage certain actions and hobbies will not work. Respecting individual freedom and actions that do not harm others will work.