[Asia Economy Reporter Chunhee Lee] The government is strengthening regulations on health-hazardous products such as tobacco and alcoholic beverages to promote public health by raising cigarette and alcohol prices and tightening advertising restrictions. The government plans to gradually increase cigarette prices to the OECD average of $7 (7,735 KRW).
The Ministry of Health and Welfare announced the "5th National Health Promotion Comprehensive Plan" containing these measures on the 27th. Through this plan, the ministry set a goal to extend healthy life expectancy from 70.4 years in 2018 to 73.3 years by 2030.
To achieve this, the ministry plans to raise the health promotion charges imposed on tobacco and introduce health promotion charges for alcoholic beverages as well. By increasing the prices of cigarettes and alcohol to create consumption barriers, the government aims to secure funding for smoking cessation, alcohol abstinence, and health projects.
Lee Seuran, Director of the Health Policy Bureau at the Ministry of Health and Welfare, explained, "The current OECD average price per pack of cigarettes is $7, but in Korea, it is about $4 (4,420 KRW)." He described this as a policy goal to raise cigarette prices. He added, "The cigarette price includes taxes and health promotion charges," indicating plans to increase all these components through the price hike.
Currently, for a pack of 20 cigarettes sold at 4,500 KRW, the health promotion charge is 841 KRW, and in addition, tobacco consumption tax is 1,007 KRW, individual consumption tax is 594 KRW, local education tax is 443 KRW, and even after deducting value-added tax, a total of 3,323 KRW in taxes is imposed. This accounts for 73.8% of the cigarette price. This is more than double the 1,550 KRW in taxes and charges when the price per pack was 2,500 KRW in the past.
Currently, alcohol taxes range from 5% to 72% of the price depending on the type, but health promotion charges have not yet been imposed. Director Lee said, "No decision has been made yet on imposing health promotion charges on alcoholic beverages," but added, "There is controversy over items like soju being widely used by lower-income groups," explaining that they plan to review overseas cases and conduct social consultations for further discussion and research.
In addition to prices, advertising of health-hazardous products will also be restricted. Currently, alcohol advertising is prohibited from 7 a.m. to 10 p.m., but this regulation applies only to television broadcasts. Lee Yoonshin, Director of Health Promotion at the Ministry of Health and Welfare, explained, "We plan to expand the applicable media to include data broadcasting, the internet, and multimedia broadcasting." She also said, "We are reviewing the prohibition of attaching advertising models (photos) on alcohol containers and plan to pursue amendments to related laws."
For tobacco, non-advertising standard cigarette packs are being introduced, strengthening both price and non-price regulations on health-hazardous products. In particular, regulations reflecting the times are being introduced, including new types of tobacco such as electronic cigarettes in addition to conventional cigarettes. Director Lee said, "We plan to expand the definition of tobacco," and explained, "We will strengthen regulations equivalent to those on conventional cigarettes through price and non-price regulatory methods."
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