Blog

Introducing Tobacconomics’ Tobacco Control Supplement: “The Economics of Tobacco Taxation in Low- and Middle-Income Countries"

Last year, we released a blog series describing the Tobacconomics approach to building think tank capacity. As the project concludes its fourth year, our partners have become adept at producing high-quality research on the economics of tobacco taxation. In this blog, we want to share some lessons learned over the past four years as well as overview our partners’ contributions to the recently released Tobacco Control Supplement. Read More

New Study Uses Four Different Approaches to Estimate Illicit Cigarette Trade in Brazil

Understanding the scope and nature of illicit cigarette trade is necessary for well-functioning administration. Analysis of illicit trade is needed to guide law enforcement activities, as it provides vital intelligence to customs, police, and other relevant agencies to protect markets and consumers from the inflow of illicit products. Additionally, since the effectiveness of tobacco control measures, including the effectiveness of tobacco taxation, is affected significantly by the availability of illicit products, knowledge about the scope of illicit cigarette trade helps policymakers evaluate newly-implemented tobacco control policies as well as predict the impact of future policies. Read More

The Pass-Through of Alcohol Excise Taxes to Prices in OECD Countries: Filling In the Evidence Gap

Increasing alcohol excise taxes is the most effective regulatory policy to reduce excessive drinking and related harms. Tax pass-through rates measure how much prices increase when taxes are increased by one unit – a critical step in the mechanism of excise taxes as an alcohol control policy. If prices are increased more than tax increases (i.e., tax pass-through rate > 1), the reduction of alcohol consumption will be higher, and vice versa. Read More

World No Tobacco Day 2020: Tobacco Taxes Are a Powerful Tool Against Tobacco Industry Efforts to Attract Youth

Sunday, May 31, 2020 is World No Tobacco Day and this year’s theme focuses on efforts by the tobacco industry to target young people. Raising tobacco taxes is one of the most effective tobacco control policy tools to discourage tobacco use in the overall population, but even more so for young people. In observation of World No Tobacco Day, this Tobacconomics blog entry highlights research from our partners around the world that demonstrates how increasing taxes on tobacco products is a particularly effective policy to prevent and reduce tobacco use among young people. Read More

A Closer Look at Tobacco Tax Progressivity: New Research from UIC Think Tank Partners in Latin America

Most research on the distributional impacts of tobacco taxation focuses on the shift in the tax burden for different income groups that occurs immediately after a tax increase. In most countries, poorer people spend proportionately more of their income on tobacco products, and they are much more sensitive to tax increases. Thus, when faced with a tax increase, their consumption of tobacco decreases more, relative to people who are older or with higher incomes, either through cessation, decreased intensity of consumption, or not starting to smoke at all. Read More

A Good First Step: Mexico Updates its Tobacco Tax for Inflation

Mexico has just approved an update for inflation to the Special Tax on Production and Services (IEPS) for tobacco as part of its “Economic Package for the Fiscal Year 2020”—the first update of the tax since 2011. For 2020, this translates to an increase of the IEPS from 0.35 to 0.498 pesos per stick, or from 7 to 9.96 pesos per pack, making a pack of cigarettes about 3 pesos (or $US 0.15) more expensive. After 2020, the IEPS will be updated annually for observed inflation. Read More

Increasing Tobacco Taxes ≠ Increasing Illicit Trade: A Look at Brazil’s Working Group

In response to growing concerns about illicit trade, the Brazilian government formed a working group in March of this year to determine whether reducing tobacco taxes would solve the problem. Although formed in response to industry arguments that tobacco taxes were the cause of increasing illicit trade, within six months, this group concluded that reducing taxes not only would not reduce illicit trade, but would, instead, have negative fiscal, tax, and health implications. In order to curb illicit trade, the group concluded, better coordination between Ministries of Finance, Health, and Foreign Affairs as well as the police force, is necessary for more effective tobacco control. Read More