BackgroundThe detrimental impact of smoking on health has been widely documented since the 1960s. Numerous studies have also quantified the economic cost that smoking imposes on society. However, these studies have mostly been in high income countries, with limited documentation from developing countries. The aim of this paper is to measure the economic cost of smoking-attributable diseases in countries throughout the world, including in low- and middle-income settings.MethodsThe Cost of Illness approach is used to estimate the economic cost of smoking attributable-diseases in 2012. Under this approach, economic costs are defined as either ‘direct costs' such as hospital fees or ‘indirect costs’ representing the productivity loss from morbidity and mortality. The same method was applied to 152 countries, which had all the necessary data, representing 97% of the world's smokers.FindingsThe amount of healthcare expenditure due to smoking-attributable diseases totalled purchasing power parity (PPP) $467 billion (US$422 billion) in 2012, or 5.7% of global health expenditure. The total economic cost of smoking (from health expenditures and productivity losses together) totalled PPP $1852 billion (US$1436 billion) in 2012, equivalent in magnitude to 1.8% of the world's annual gross domestic product (GDP). Almost 40% of this cost occurred in developing countries, highlighting the substantial burden these countries suffer.ConclusionsSmoking imposes a heavy economic burden throughout the world, particularly in Europe and North America, where the tobacco epidemic is most advanced. These findings highlight the urgent need for countries to implement stronger tobacco control measures to address these costs.

ObjectiveTo investigate the potential for tobacco tax to contribute to the 2030 agenda for sustainable development by reducing tobacco use, saving lives and generating tax revenues.MethodsA model of the global cigarette market in 2014 – developed using data for 181 countries – was used to quantify the impact of raising cigarette excise in each country by one international dollar (I$) per 20-cigarette pack. All currencies were converted into I$ using purchasing power parity exchange rates. The results were summarized by income group and region.FindingsAccording to our model, the tax increase would lead the mean retail price of cigarettes to increase by 42% – from 3.20 to 4.55 I$ per 20-cigarette pack. The prevalence of daily smoking would fall by 9% – from 14.1% to 12.9% of adults – resulting in 66 million fewer smokers and 15 million fewer smoking-attributable deaths among the adults who were alive in 2014. Cigarette excise revenue would increase by 47% – from 402 billion to 593 billion I$ – giving an extra 190 billion I$s in revenue. This, in turn, could help create the fiscal space required to finance development priorities. For example, if the extra revenue was allocated to health budgets, public expenditure on health could increase by 4% globally.ConclusionTobacco taxation can prevent millions of smoking-attributable deaths throughout the world and contribute to achieving the sustainable development goals. There is also potential for tobacco taxation to create the fiscal space needed to finance development, particularly in low- and middle-income countries.

BackgroundThe Healthy China 2030 strategy sets ambitious targets for China’s policy-makers, including a decrease in the smoking rate from 27.7% in 2015 to 20% by 2030. China has made progress on tobacco control in recent years, but many key measures remain underused. This study explores the potential for full implementation of these measures to achieve the targeted reduction in smoking by 2030.MethodsFirst, a ‘business as usual’ scenario for China’s cigarette market was developed based only on underlying economic parameters. Second, non-price tobacco control measures were then added assuming they are fully implemented by 2030. Third, excise per pack was raised to a level that would increase the real price of cigarettes by 50% in 2030.FindingsUnder the business as usual scenario, the rate of smoking falls to around 26.6% in 2030. When non-price measures are included, the rate of smoking falls to 22.0% (20.9%~23.1%). Thus, non-price measures alone are unlikely to achieve the Healthy China target. Under the third scenario, excise per pack was roughly doubled in 2030 in order to increase real cigarette prices by 50%. The rate of smoking then falls to 19.7% (18.2%~21.3%), reflecting 78 million (59~97 million) fewer smokers compared with 2016. In addition, real excise revenue from cigarettes increases by 21% (−3%~47%) compared with 2016.ConclusionSignificantly higher tobacco taxes will be needed to achieve Healthy China 2030 target for reduced smoking even after the implementation of other tobacco control measures.

In 2015, the Chinese government raised tobacco excise tax for the first time since 2009. Changing from previous practice, the State Tobacco Monopoly Administration raised its cigarette prices at the same time. We assessed the early impact of the 2015 tax increase on cigarette prices, sales volumes, tax revenue generation and the potential effect on prevalence of smoking in China. Between 2014 and 2016, the retail price of cigarettes increased on average by 11%, with the cheapest category of cigarette brands increasing by 20%. The average proportion of tax in the price of cigarettes rose from 51.7% to 55.7%. Annual cigarette sales decreased by 7.8%, from 127 to 117 billion packs. The increase in cigarette prices could be associated with a 0.2% to 0.6% decrease in the proportion of adults smoking, representing between 2.2 and 6.5 million fewer smokers. Tax revenues from cigarettes increased by 14%, from 740 to 842 billion Chinese yuan between 2014 and 2016, reflecting an extra 101 billion Chinese yuan in tax revenues for the government. The 2015 tax increase shows that tobacco taxation can provide measurable benefits to both public health and finance in China. The experience also highlights the potential for tobacco taxation to contribute to China’s broader development targets, including the sustainable development goals and Healthy China 2030. Looking forward, this link to development can be facilitated through multisectoral research and dialogue to develop consistent cross-sectoral objectives for tobacco tax policy design and implementation.

Bangladesh has achieved a high share of tax in the price of cigarettes (greater than the 75% benchmark), but has not achieved the expected health benefits from reduction in cigarette consumption. In this paper we explore why cigarette taxation has not succeeded in reducing cigarette smoking in Bangladesh. Using government records over 2006–2017, we link trends in tax-paid cigarette sales to cigarette excise tax structure and changes in cigarette taxes and prices. We analysed data on smoking prevalence from Bangladesh Global Adult Tobacco Surveys to study consumption of different tobacco products in 2009 and 2017. Drawing on annual reports from tobacco manufacturers and other literature, we examine demand- and supply-side factors in the cigarette market. In addition to a growing affordability of cigarettes, three factors appear to have undermined the effectiveness of tax and price increases in reducing cigarette consumption in Bangladesh. First, the multitiered excise tax structure widened the price differential between brands and incentivized downward substitution by smokers from higher-price to lower-price cigarettes. Second, income growth and shifting preferences of smokers for better quality products encouraged upward substitution from hand-rolled local cigarettes ( bidi ) to machine-made low-price cigarettes. Third, the tobacco industry’s market expansion and differential pricing strategy changed the relative price to keep low-price cigarettes inexpensive. A high tax share alone may prove inadequate as a barometer of effective tobacco taxation in lower-middle income countries, particularly where the tobacco tax structure is complex, tobacco products prices are relatively low, and the affordability of tobacco products is increasing.