SAPPORO, Japan — After I attended a conference with fellow NGO leaders from many countries on taxation-regulation issues in Krakow, Poland last week (Oct. 6-8), I flew here to attend another conference, The 1st ASHRA Congress: Harm Reduction in the Asia-Pacific Rim. It was organized by the Asia-Pacific Society of Harm Reduction and Addiction (ASHRA), held from Oct. 9 to 11 at the Sapporo Convention Center, Hokkaido, Japan. I missed Day 1 because of the long flights from Krakow via Istanbul, then Tokyo-Haneda before reaching Sapporo.
ASHRA is a good association of physicians, neurologists, psychiatrists, psychologists, addiction specialists, and even criminologists. Mostly from Japan and Taiwan, there were also speakers and panel chairs from Indonesia, Malaysia, Thailand, Vietnam, the Philippines, Hong Kong, Australia, New Zealand, the US, etc. The Filipino doctor who spoke was Dr. Mariano S. Hembra of the Philippines Addiction Specialists Society, and also a physician in a hospital in Iloilo.
The topics discussed were varied — gambling and internet addiction, drugs and substance addiction, over-the-counter (OTC) drugs overuse, tobacco and drugs harm reduction (HR), etc. I did not know the extent of addiction in gambling (online and face to face), internet addiction especially children, OTC drug (legal, no need for physician prescription) overdose, etc. until I listened to the many speakers.
One concept that was new to me was a definition of harm reduction by Dr. Alex Wodak of St. Vincent Hospital in Sydney, Australia. He said that HR are “Policies and practices which aim to reduce health, social, and economic costs of a risk behavior without necessarily reducing that risk behavior.” He mentioned examples like mandatory car seat belts, air bags, and motorcycle helmets.
Yes, I agree. There are risks to driving as one has no control over the behavior of other drivers, but if an accident happens, the harm to the motorist and passengers is reduced by those airbags and helmets. There is no need for coercion and mandatory driving reduction like during the horrible lockdowns of 2020-2021.
The varied topics mentioned above are related to several public policy debates in the Philippines. I am not a physician or psychologist, so I will focus on the economic and public finance aspects of those issues. In particular, about taxation of tobacco products as HR.
I checked some data on the incidence or prevalence of smoking around the world and two things stood out: there has indeed been a decline in the smoking rate or tobacco use among adults over the last two decades, but the smoking rate remains high — like 30% or more — in many countries as of 2024, including Myanmar, Indonesia, Vietnam, the Philippines, China, South Korea, France, and Russia (see the table).
There is no longer a debate that cigarettes and burning tobacco are harmful to health. But people own their bodies and decide how much of a risk they can take in exchange for enjoyment. Like drinking, smoking, vaping, couch potato living, downhill cycling, motor racing, climbing rocks or tall trees, skydiving, deep sea diving, etc.
The appropriate policy is to encourage people to observe HR measures in any adventure or behavior or lifestyle they take. For driving, it is using a seatbelt; for cycling, it is using helmet, kneepad, and elbow pad. For boxing and other contact sports, it is using head protection. For drinking, it is consuming a drink with low alcohol content and pairing it with tonic water. For smoking, it is using vapes or heated tobacco products, with no burning of substances.
The outright banning of behaviors and lifestyles that are deemed “unhealthy” by certain sectors is regulatory overreach and an infringement on individual liberty and personal choice.
Prohibition should be limited to acts that harm other people — like murder, shooting/stabbing, abduction, rape, arson, stealing, deliberate destruction of other people’s properties. Which is consistent with the classical definition of the reason for existence (raison d’etre) of government, why government was invented in the first place — to protect the people’s right to life, right to private property, and right to liberty.
In the current Department of Finance (DoF) sponsored bill in Congress, the Promoting Growth, Revenue, and Equity towards Socio-Economic Sustainability (ProGRESS) bill, the DoF is proposing many tax hikes — on alcohol, plastic, sugar, tobacco/vapes, luxury vehicles, global minimum corporate income tax — supposedly to compensate for revenue loss from a minor income tax cut.
The problem is that instead of encouraging harm reduction via a lower tax on vapes or heated tobacco products — or the non-taxation of HR devices — the DoF is proposing a similar tax rate as that on regular cigarettes which discourage HR and a shift to less-harmful products. HR is harm recognition, not harm denial, of these new tobacco products.
The ProGRESS bill proposes an increase in the nicotine-salt tax from the current P60.20/ml to P72.90/ml, and freebase from P6.95/ml to P36.45/ml by 2027, then an annual 5% increase.
My own computation from actual data in 2025, out of the P2.54 billion in revenues that the DoF received from vapes, 94% was from items declared as freebase and only 6% from Nic-salt. Which is tantamount to technical smuggling, on top of outright smuggling where tax payment is zero.
The proposal by some legislators like Ilocos Rep. Grace Singson-Meehan is for a single or unitary tax rate of P10/ml, then a 5% annual increase. This is an increase from the current P6.95/ml where 94% of all vape products are declared.
I support this proposal. We should choose tax rate optimization that raises overall revenues and reduces smuggling, and not tax rate maximization that raises the incidence of smuggling and reduces overall revenues. That is the appropriate economics of harm reduction in tobacco products. It helps the DoF raise more revenues while reducing the income of smugglers and their corrupt protectors in government.
Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.