Could a vaccine tax ensure equitable vaccine distribution?

Could a vaccine tax ensure equitable vaccine distribution?
© iStock/mrgao

Andreas Brøgger Albertsen of Aarhus University spoke to HEQ about how a vaccine tax could ensure a more equitable global vaccine distribution during the pandemic.

To aid the continued fight against the COVID-19 pandemic, ensuring an equitable global vaccine distribution is critical. As of January 2022, 58.5% of the world population has received at least one dose of a COVID-19 vaccine yet only 8.5% of people in low-income countries have received at least one dose.1

Equitable vaccine distribution is essential for controlling the spread of the virus, preventing hospitalisations and deaths, and reducing the chances of a new variant emerging. Therefore, a solution is needed to help overcome some of the barriers which are preventing equitable vaccine access. Introducing a vaccine tax is one solution proposed by Andreas Brøgger Albertsen, Associate Professor at Aarhus University.

Last year, he released a paper entitled ‘A vaccine tax: ensuring a more equitable global vaccine distribution’. This scheme would mean that when a country buys vaccines for its own population, some of this money would go into a fund which is dedicated to buying vaccines and distributing them to low-income countries.

Here, HEQ spoke to Albertsen about the potential of a taxation model for COVID-19 vaccines.

What are the primary factors slowing the progress of equitable vaccine distribution?

The current distribution is primarily a market-based model. Countries buy vaccines in a free market, which is determined by supply and demand. Richer countries have the upper hand in acquiring vaccines and will receive a large share of the vaccines. There is great disparity between vaccine distribution in high-income countries and low-income countries. This is a huge problem that many people have pointed to.

COVAX was designed to mitigate this problem, allowing countries to donate money or excess vaccines to help low-income countries. However, COVAX is not reaching its own targets. The current market-based distribution model, as well as an insufficient willingness to donate money or vaccines, will continue creating this inequality. These are some of the important barriers to be aware of.

Can you talk me through how a taxation model for COVID-19 vaccines would work and the key benefits of this in comparison to donation initiatives like COVAX?

My focus on tax is not an alternative to COVAX and instead should be considered as an alternative funding source for COVAX. The main idea behind the vaccine tax would be that when countries buy vaccines, a share of the money that they have used will be set aside and transferred to COVAX. This is not meant to be a voluntary scheme; it is something that should be implemented. It means that every country that buys vaccines will also pay the tax. Vaccine producers would be responsible for collecting and transferring the tax. Countries should still be able to donate money to COVAX, but the vaccine tax would function as a separate and independent funding.

What are the key barriers that have stopped a tax from being introduced? Why do you think policymakers have not considered this as an option?

For the vaccine tax scheme to work, I propose that the taxes are to be implemented by all the producers to avoid unfair competition. There are several proposals aimed at improving the current situation which focus on the producers doing something differently, such as sharing knowledge and patents, for example.

The question is: how do we adhere to some of these proposals? COVAX could provide an economic incentive for companies to introduce the vaccine tax, by implementing legislation which states that governments would only buy vaccines from companies which have pledged to introduce the vaccine tax.

Implementing the vaccine tax in tandem with modified patents legislation rights could also be considered. For this, it should be stated that if you want to have a patent for vaccines, then a requirement is that you adhere to the vaccine tax model.

Another possibility would be to condition public funding for vaccine research on participation in the vaccine tax. The companies would do it voluntarily as it would not be costly for them to do so. At least if every company did this, the tax would be paid by the countries and not by individuals.

Do you think vaccines producers would be willing to do this?

There are moral obligations not being met in the current system. I believe that we must expect people to behave roughly as they do today; no one will turn into a moral saint overnight and want to comply with all basic moral obligations. We have to think of a system that will improve the current situation, without assuming that everyone is tilted towards having good moral intentions.

Therefore, the model I have developed keeps the incentive structure in place for the vaccine producers. Many people would argue that this model is not enough because the producers are making too much money. However, I am hesitant to propose a model that potentially results in fewer vaccines being produced now, or in the future.

Do you see a snowballing effect, that if this tax was introduced and money freed up, then it could go towards the transference of vaccine technology may be in manufacturing vaccines in low- and middle-income countries?

I would hope that COVAX could support such initiatives, but I would not claim that the vaccine tax would lead to these kinds of projects. The vaccine tax is a contained proposal which can be administered within the current system, so it probably will not lead to a drastic change within this setup. This is a fair criticism of the proposal; it does not do enough to change how things are in terms of who produces, and the profit structure.

© iStock/Kanawa_Studio

In terms of it being implemented, how important is cross-border collaboration in trying to incentivise and implement something like this?

In one sense it is important because we need countries to put pressure on companies to implement this proposal. In another sense, for the vaccine tax to work, we need companies to participate, we do not need a world government to collect the tax. It is simply something that can be implemented at the company level. This should be completely transparent; how much they receive, and how much gets set aside for COVAX.

If a tax was implemented, what would you say are the outstanding challenges with regards to access to COVID-19 vaccines?

It is important to notice that the proposal is aimed at mitigating the comparative inequality of the policy between the high-income countries and low-income countries. It would not necessarily mean that it would improve the absolute number of vaccines that we have available. To a large extent, the vaccine tax is about administration.

There is the outstanding issue that there is not a sufficient supply of vaccines for everyone. If the disparity between vaccine distribution in high- and low-income countries is due to a lack of ability to pay for them, the vaccine tax will address this issue and ensure that low-income countries receive a sufficient supply. If a lack of supply to low-income countries is due to another reason, such as scarcity, the vaccine tax cannot do anything to solve this problem, and simply, the number of vaccines produced needs to be increased through other means.

Albertsen A. A vaccine tax: ensuring a more equitable global vaccine distribution Journal of Medical Ethics Published Online First: 15 November 2021.



Andreas Brøgger Albertsen
Associate Professor
Centre for the Experimental-Philosophical Study of Discrimination (CEPDISC)
Department of Political Science
Aarhus University

This article is from issue 20 of Health Europa Quarterly. Click here to get your free subscription today.

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