The Impact of Prices and Taxes on the Use of Tobacco Products in Latin America and the Caribbean

Abstract

We examined the impact of tobacco prices or taxes on tobacco use in Latin America and Caribbean countries. We searched MEDLINE, EconLit, LILACS, unpublished literature, 6 specialty journals, and reviewed references. We calculated pooled price elasticities using random-effects models. The 32 studies we examined found that cigarette prices have a negative and statistically significant effect on cigarette consumption. A change in price is associated with a less than proportional change in the quantity of cigarettes demanded. In most Latin American countries, own-price elasticity for cigarettes is likely below -0.5 (pooled elasticities, short-run: -0.31; 95% confidence interval=-0.39, -0.24; long-run: -0.43; 95% CI=-0.51, -0.35). Tax increases effectively reduce cigarette use. Lack of studies using household- or individual-level data limits research's policy relevance.

In Mexico, Evidence Of Sustained Consumer Response Two Years After Implementing A Sugar-Sweetened Beverage Tax

“…These findings provide empirical evidence to model-based price elasticity studies of SSB demand in the United States showing higher price elasticity in the long run compared to the short run (22). Economics studies of tobacco and other highly preferred habit-forming items where research imply that the long-term impact of a price change will be much larger than the short-term effect for tobacco, alcohol and illicit drugs (34-38). The higher reduction in purchases in the second year of the tax suggests that this may be true for SSB purchases also.…”

Factores socioeconómicos asociados con la compra ilegal de productos de tabaco en Panamá

“…22 Finalmente, el consumo diario de cigarrillos en el primer quintil es de 9.4, en el tercer quintil de 14.5, y en el quinto de 19.6 según la EMTA, con lo cual se puede sostener que el incremento del ISC es poco perceptible en la estructura de consumo. 9,19,[23][24][25][26][27] El riesgo de compra de cigarrillos ilícitos fue mayor en ciertos establecimientos como supermercados y tiendas libres de impuestos. Dicho riesgo fue demostrado previamente en las encuestas de marcas de 2012, 2015 y la EMTA, particularmente en la Zona Libre de Colón y en Paso Canoas, en la frontera con Costa Rica, donde el público adquiere marcas que no están legalizadas para ser vendidas en el territorio nacional por no cumplir con las disposiciones sanitarias y que están en torno a zonas pauperizadas.…”

Prices, Inflation, and Smoking Onset: The Case of Argentina

“…A recent systematic review examined the impact of tobacco prices or taxes on tobacco use in Latin American and Caribbean countries and found that cigarette prices had a negative and statistically significant effect on cigarette consumption (Guindon, Paraje, and Chaloupka ). The review concluded that in most Latin American countries, total own‐price elasticity for cigarettes was likely below |–0.5| but noted a lack of studies that used individual‐level data.…”