Background In Bangladesh, the average excise tax on cigarettes accounted for merely 38% in 2009 and 45% in 2010 of the average retail price of cigarettes. It is well below the WHO recommended share of 70% of the retail price at a minimum. There is thus ample room for raising taxes on cigarettes in Bangladesh. Objective The objective of the paper is to estimate the price elasticity of demand for cigarettes and the effect of tax increases on the consumption of cigarettes and on tax revenue in Bangladesh. Methods Based on data from Wave 1 (2009) and Wave 2 (2010) of the International Tobacco Control Bangladesh Survey, we estimate the overall impact of a price change on cigarette demand using a two-part model. The total price elasticity of cigarettes is measured by the sum of the elasticity of smoking prevalence and the elasticity of average daily consumption conditional on smoking participation. The price elasticity estimates are used in a simulation model to predict changes in cigarette consumption and tax revenue from tax and price increases. Findings The total price elasticity of demand for cigarettes is estimated at −0.49. The elasticity of smoking prevalence accounts for 59% of the total price elasticity. The price elasticity of cigarette consumption is higher for people belonging to lower socio-economic status. Increases in taxes would result in significant reduction in cigarette consumption while tax revenue increases. Conclusion Raising cigarette price through increased taxation can lead to a win-win-win situation in Bangladesh—it will reduce cigarette consumption, increase tobacco tax revenue and potentially decrease socio-economic inequities.
Street food vending is a prevailing and distinctive part of a large informal sector in Dhaka city, the capital of Bangladesh. The paper attempts to gain insight into the business of street food vendors: highlight the problem areas and identify some key factors that positively affect their sales revenue. Using factor analysis as a tool, four major problem areas for the street food vendors have been identified. The problem areas are related to business operation, business knowledge, extortion, and product and production. Through regression analysis, it has been found that business experience, and initial capital is two key factors that positively affect sales revenue. Formal education, however, does not have any significant impact on business performance. The paper also comes to the conclusion that lack of security and problems in the supply of raw materials are two major problems as perceived by the vendors.
BackgroundDespite modest progress in reducing tobacco use, tobacco remains one of the major risk factors for non-communicable diseases in Bangladesh.MethodsUsing disease-specific, prevalence-based, cost-of-illness approach, this research estimated the economic costs of tobacco use and exposure to secondhand smoke based on data collected from a nationally representative survey of 10 119 households in 2018.ResultsThe study estimated that 1.5 million adults were suffering from tobacco-attributable diseases and 61 000 children were suffering from diseases due to exposure to secondhand smoke in Bangladesh in 2018. Tobacco use caused 125 718 deaths in that year, accounting for 13.5% of all-cause deaths. The total economic cost was 305.6 billion Bangladeshi taka (BDT) (equivalent to 1.4% of gross domestic product or US$3.61 billion), including direct costs (private and public health expenditures) of BDT83.9 billion and indirect costs (productivity loss due to morbidity and premature mortality) of BDT221.7 billion. The total economic cost of tobacco more than doubled since 2004.ConclusionTobacco use imposes a significant and increasing disease and financial burden on society. The enormous tobacco-attributable healthcare costs and productivity loss underscore the need to strengthen the implementation of tobacco control policies to curb the epidemic.
background Taxing tobacco is among the most effective measures of tobacco control. However, in a tiered market structure where multiple tiers of taxes coexist, the anticipated impact of tobacco taxes on consumption is complex. This paper investigates changing smoking behaviour in lieu of changing prices and changing income. The objective of the paper is to evaluate the effectiveness of change in prices (through taxes) and change in income in a price-tiered cigarette market. Method A panel dataset from the International Tobacco Control Bangladesh surveys is used for analysis. For preliminary analysis transition matrices are developed. Next, probit and multinomial logit regression models are used to identify the effects of changes in prices and changes in income along with other control variables. Findings Transition matrices show significant movement of smokers across price tiers from one wave to another. Regression results show that higher income raises the probability to up-trade and decreases the probability to down-trade. Results also show that higher prices raises the probability to up-trade and reduces the probability to down-trade. Although not significant, there exists a negative relationship between the probability to down-trade and the probability to intend to quit. Conclusion It is evident from the results that a pricetiered market provides smokers more opportunities to accommodate their smoking behaviour when faced with price and income change. Therefore, tiered structure of the tax system should be replaced with uniform taxes. Moreover, overall cigarette taxes need to be raised to an extent so that it off-sets any positive effects of income growth.
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