An analysis of purchase price of legal and illicit cigarettes in urban retail environments in 14 low‐ and middle‐income countries

Brown, Jennifer; Welding, Kevin; Cohen, Joanna E.; Cherukupalli, Rajeev; Washington, Carmen; Ferguson, Jacqueline; Smith, Katherine Clegg

doi:10.1111/add.13881

Cited by 13 publications

(7 citation statements)

References 22 publications

(20 reference statements)

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“…One study found, for example, that the median price of illicit cigarettes was in fact higher than legal cigarettes in six LMICs (Bangladesh, India, Pakistan, Philippines, Thailand and Vietnam), but lower in three (Turkey, Ukraine and China). 2 The authors highlighted taste and brand preference by consumers as likely contributory factors in countries where the price of illicit cigarettes is higher, while also noting that the illicit market is not a homogeneous entity. 2 The study by Joossens et al 1 focused on smuggling of premium cigarettes thought to dominate the illicit market at the time.…”

Section: Introductionmentioning

confidence: 99%

“…2 The authors highlighted taste and brand preference by consumers as likely contributory factors in countries where the price of illicit cigarettes is higher, while also noting that the illicit market is not a homogeneous entity. 2 The study by Joossens et al 1 focused on smuggling of premium cigarettes thought to dominate the illicit market at the time. Other sources of illicit trade have since emerged including illegal or undeclared manufacturing.…”

Section: Introductionmentioning

confidence: 99%

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Potential impact of eliminating illicit trade in cigarettes: a demand-side perspective

et al. 2020

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BackgroundThe Protocol to Eliminate Illicit Trade in Tobacco Products (the Protocol) entered into force in September 2018, and commits Parties to implement a package of measures to combat this global problem. The aim of this study is to assess the potential impact of eliminating illicit cigarettes on consumption, use and tax revenues.MethodsWe identified 36 countries where an independent (non-industry sponsored) study of the illicit cigarette market was available. We developed a conceptual framework for describing how the elimination of illicit cigarettes might impact on demand (consumption and use) and applied this framework to our sample of countries to assess the impact of eliminating illicit cigarettes across different settings.FindingsIllicit cigarettes account on average for 11.2% of the market in these 36 countries. The elimination of illicit cigarettes would reduce total cigarette consumption by 1.9% across these countries. The decrease in ‘group A’ countries—where illicit cigarettes are >15% of the market—would average 4.1%. The smoking rate would decrease by 1.0% in relative terms including by 2.2% in group A countries. Tax revenues from the legal sale of cigarettes would increase by 11.2% including by 25.1% in group A countries.ConclusionsThe illicit cigarette market reflects a complex interplay between supply and demand, with an array of different country conditions. Regardless of the situation, our study highlights the contribution that the elimination of illicit trade can make to tobacco control through demand reduction while at the same time generating significant tax revenues.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Potential impact of eliminating illicit trade in cigarettes: a demand-side perspective

et al. 2020

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“…Tobacco control researchers around the world often triangulate several methods to improve the precision of their estimates of the magnitude of illicit trade [ 24 ]. The volume of scientific literature is skewed towards the high- and upper middle-income countries [ 1 , 4 , 5 , 6 , 7 , 17 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 ] relative to the low- and lower middle-income countries [ 11 , 24 , 35 , 36 , 37 , 38 ]. This is perhaps due to the issue of data availability and research capacity.…”

Section: Discussionmentioning

confidence: 99%

Estimating the Magnitude of Illicit Cigarette Trade in Bangladesh: Protocol for a Mixed-Methods Study

Abdullah

Huque

Bauld

et al. 2020

IJERPH

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The illicit tobacco trade undermines the effectiveness of tobacco tax policies; increases the availability of cheap cigarettes, which, in turn, increases tobacco use and tobacco related deaths; and causes huge revenue losses to governments. There is limited evidence on the extent of illicit tobacco trade particularly cigarettes in Bangladesh. The paper presents the protocol for a mixed-methods study to estimate the extent of illicit cigarette trade in Bangladesh. The study will address three research questions: (a) What proportion of cigarettes sold as retail are illicit? (b) What are the common types of tax avoidance and tax evasion? (c) Can pack examination from the trash recycle market be considered as a new method to assess illicit trade in comparison to that from retailers and streets? Following an observational research method, data will be collected utilizing empty cigarette packs from three sources: (a) retailers; (b) streets; and (c) trash recycle market. In addition, a structured questionnaire will be used to collect information from retailers selling cigarettes. We will select post codes as Primary Sampling Unit (PSU) using a multi-stage random sampling technique. We will randomly select eight districts from eight divisions stratified by those with land border and non-land border; and within each district, we will randomly select ten postcodes, stratified by rural (five) and urban (five) PSU to ensure maximum geographical variation, leading to a total of eighty post codes from eight districts. The analysis will report the proportions of packs that do not comply with the study definition of illicit. Independent estimates of illicit tobacco are rare in low- and middle-income countries such as Bangladesh. Findings will inform efforts by revenue authorities and others to address the effects of illicit trade and counter tobacco industry claims.

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“…Indeed, evidence from other countries shows that illicit cigarettes are often more, rather than less, expensive than legal offerings. 12 In broad terms, however, the equivalent retail sales value of illicit cigarettes can be estimated by multiplying the number of illicit cigarette sticks by their average retail price in the legal, retail market. In India, the average retail price of 10 cigarette sticks was reported to be about ₹87 (US$ 1.34) in 2016 to 2017.…”

Section: Methodsmentioning

confidence: 99%

Estimating illicit cigarette consumption using a tax-gap approach, India

Goodchild

Valavan

Sinha

et al. 2020

Bull. World Health Organ.

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Objective To estimate the magnitude of illicit cigarette consumption in India using a tax-gap approach. Methods In the tax-gap analysis, illicit cigarette consumption in India was defined as the difference between total and legal consumption. Data on total cigarette consumption came from two national Global Adult Tobacco Surveys carried out from 2009 to 2010 and from 2016 to 2017. Legal consumption was derived from Government of India data on domestic cigarette production and trade. Findings Estimated total cigarette consumption was 104.8 billion sticks in 2009 to 2010 and 94.2 billion sticks in 2016 to 2017, a decrease of 10.6 billion sticks, or of 10%, over the time period. Legal cigarette consumption fell from 99.4 to 88.5 billion sticks over the same period, a drop of 11%. Estimated illicit cigarette consumption was, therefore, 5.4 billion sticks in 2009 to 2010 and 5.6 billion sticks in 2016 to 2017, and accounted for 5.1% and 6.0% of the market in these periods, respectively. Consequently, only about 1 in 20 cigarettes consumed in India was illicit. Between 2016 and 2017, the estimated equivalent retail sales value of illicit cigarettes was 49 billion Indian rupees (753 million United States dollars, US$) and the estimated tax revenue foregone was 25 billion Indian rupees (US$ 390 million). Conclusion Illicit cigarette consumption is relatively modest in India by global standards. Nonetheless, India should strengthen its capacity to control the illicit tobacco market as part of a comprehensive tobacco control strategy, while also continuing to implement traditional demand reduction measures, such as tobacco taxation.

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An analysis of purchase price of legal and illicit cigarettes in urban retail environments in 14 low‐ and middle‐income countries

Cited by 13 publications

References 22 publications

Potential impact of eliminating illicit trade in cigarettes: a demand-side perspective

Potential impact of eliminating illicit trade in cigarettes: a demand-side perspective

Estimating the Magnitude of Illicit Cigarette Trade in Bangladesh: Protocol for a Mixed-Methods Study

Estimating illicit cigarette consumption using a tax-gap approach, India

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