Gains from the Rise in Tobacco Excise Taxes in BiH

This Policy Brief was written by University of Banja Luka (UBL) in Bosnia and Herzegovina. The policy estimates the impact of raising tobacco taxes on tax revenues, public health, and youth smoking initiation. Specifically, the researchers simulate a 15% increase in the specific excise tax in 2024 and 2025, which would increase average retail sales prices by 11%. This would decrease the number of packs sold between 1% and 2.9% while increasing total tax revenue between BAM 114 and 159 million. Adult smoking prevalence, currently at 41.1%, would decrease to 37.4% by 2025 as a result of this price increase and between 3,129 and 3,159 youth would not initiate smoking. This reduction in consumption would prevent between 9,006 and 19,133 premature adult deaths and save between 1,251 and 1,264 youth lives annually, on average. The policy brief concludes with recommendations for policy makers to increase the tobacco excise tax and reap these benefits.