Effect of excise tax increases on cigarette prices in South Africa

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IDL-57604.pdf (935.07 KB)

Date

2017-03-24

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Abstract

The effectiveness of excise tax as a tool for reducing tobacco consumption depends largely on how the tax increases impact retail prices. The study estimates this price relationship in South Africa (2001–2015). The magnitude of the price increase depends on the degree to which the tax increase is passed through to consumers. The degree of passthrough thus determines effectiveness. This paper considers the dynamics of cigarette excise tax passthrough in South Africa. People change their purchasing behavior in response to retail price changes, not in response to excise tax changes.

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Keywords

EXCISE TAX, TAXATION, TOBACCO CONTROL, NON-COMMUNICABLE DISEASES, PUBLIC HEALTH, CIGARETTES, PRICING, SOUTH AFRICA, SOUTH OF SAHARA

Citation

Linegar DJ, van Walbeek C. Tob Control 2018;27:65–71.

URI

http://hdl.handle.net/10625/57604

DOI

Collections

IDRC Research Results / Résultats de recherches du CRDI
2010-2019 / Années 2010-2019
Tobacco use / Usage du tabac