Cigarette Prices and Smoking Experimentation among Zimbabwean children: a survival analysis of the 2014 Global Youth Tobacco Survey.

INTRODUCTION: Zimbabwe has a smoking prevalence of 11.7% among the adult population (15 years and older). Thus, in the absence of effective tobacco-control measures, the economic burden of tobacco use will be aggravated, especially considering the increasing tobacco industry activity in the country. Increasing cigarette prices is one possible strategy to reduce tobacco consumption. This study seeks to examine the relationship between cigarette prices and smoking experimentation among children in Zimbabwe, thereby expanding the evidence base for the likely impact of excise taxes on cigarette demand in low-income and middle-income countries. METHODS: A survival analysis using the Zimbabwe 2014 Global Youth Tobacco Survey data. RESULTS: A 10% increase in the price of cigarettes reduces the probability of experimenting with smoking by 9%. Also, children are more likely to experiment with smoking if they have a smoking brother or father who smokes, or see teachers who smoke. The likelihood of experimenting with smoking is higher among boys than girls and is positively associated with age. CONCLUSIONS: There is strong evidence that increasing excise taxes can play an effective role in discouraging children from experimenting with cigarette smoking. Considering the relatively low excise tax burden in Zimbabwe, the government should consider substantially increasing the excise tax burden. IMPLICATIONS: With the number of smokers in low- and middle-income countries expected to increase as the industry intensively expands its market by targeting the youth, increasing excise taxes will play a significant role in preventing children from initiating smoking and help those already using tobacco to quit. An increase in the excise tax increases the retail price of tobacco products, making them less affordable, and reduces the demand for them.

Cigarette excise tax structure and cigarette prices in nine sub-Saharan African countries: evidence from the Global Adult Tobacco Survey.

BACKGROUND: Economic theory predicts that the excise tax structure influences the distribution of cigarette prices. Evidence shows that uniform specific excise tax structures exhibit the least price variability relative to other tax structures. The distribution of cigarette prices under different excise tax structures has never been examined for a group of African countries. OBJECTIVES: To examine the distribution of cigarette prices under different tax structures in nine African countries and to critically evaluate the effectiveness of African regional tax directives in promoting public health. METHODS: Data from the Global Adult Tobacco Survey, conducted in eight African countries during 2012-2018, and data from the 2017 Gambia Tobacco Survey were used to construct survey-derived cigarette prices. The coefficients of variation and skewness of the price distribution were compared in the context of each country's cigarette excise tax structure. RESULTS: The least price variability is found in countries with a uniform specific tax, or a mixed system with a minimum specific floor. Cigarette price variability is largest in countries with uniform ad valorem tax structures. Three of the four countries with ad valorem tax structures are in regional blocs, where the tax directives specify that they should implement an ad valorem structure. CONCLUSIONS: Regional tax directives that require the adoption of uniform specific excise taxes, or high minimum specific floors, could be an efficient way to get multiple African countries to adopt a tax structure that reduces substitution possibilities in response to excise tax increases.

Interactions between ENDS and cigarette use: evidence from a 2022 national telephone survey in South Africa.

INTRODUCTION: Electronic nicotine delivery systems (ENDS) may serve as a cessation tool for people who smoke cigarettes. However, for people who do not smoke, ENDS may be a gateway to nicotine addiction and cigarette use. This paper aims to quantify these behaviours in South Africa. METHODS: We analysed a nationally representative telephone survey of 21 263 South Africans living in urban areas. For those respondents who had used both products (N=771), we developed a typology that describes the sequence in which cigarette and ENDS initiation occurred. 'On-rampers' describe people who used ENDS first and later initiated cigarette smoking. 'Off-rampers' describe people who used cigarettes first, took up ENDS and later quit cigarettes while still using ENDS. 'Failed off-rampers' describe people who started using ENDS while smoking cigarettes but later quit using ENDS. 'Continuing dual consumers' describe people still using both products at the time of the interview. RESULTS: Of the overall sample (N=21 263), 1.7% used or had used ENDS but had no history of using cigarettes. Of dual consumers (N=771), 8.8% were classified as 'on-rampers', 13.9% as 'off-rampers', 20.9% as 'failed off-rampers' and 56.4% as 'continuing dual consumers'. Roughly half of those classified as off-rampers, failed off-rampers or continuing dual consumers stated that they started using ENDS to help them quit cigarettes. CONCLUSIONS: The typology reveals a multifaceted relationship between ENDS and cigarette use in South Africa. Policy interventions should aim to minimise on-ramping and maximise off-ramping. Given the high prevalence of continued dual use and failed off-ramping, targeted cessation support should be provided for people who use ENDS and are trying to quit cigarettes.

When Cigarette Sales Suddenly Become Illegal: Evidence From an Online Survey of South African Smokers During COVID-19 Lockdown.

INTRODUCTION: Despite high levels of illicit trade in the tobacco market, the South African government banned the sale of tobacco products in March 2020 as part of its COVID-19 response. The ban lasted five months. We assess how the ban affected the cigarette market for a sample of smokers by comparing the price, consumption, and competitive landscapes before (March), during (May and June), and after (September) the ban. METHODS: We conducted three online surveys of cigarette smokers, asking about smoking behavior before, during, and after the ban. We use descriptive statistics and OLS regressions to estimate the impact of the ban on the South African cigarette market, focusing on the price of cigarettes. RESULTS: Most smokers continued smoking despite the sales ban. During the ban, prices increased by over 240%. Purchases shifted away from the normally dominant brands of the multinational tobacco companies to local/regional producers. The covariates of price changed substantially during the sales ban, the most pronounced being inter-provincial effects. After the ban, the market shifted back to its preban state, with an overall increase in price of 3.6%. CONCLUSIONS: Cigarette sales continued despite the sales ban, further entrenching an already large illicit market. Had the government substantially increased the excise tax, rather than banned the sale of tobacco products, it would have achieved a similar public health outcome, received more revenue, and presumably not further entrenched the illicit market. IMPLICATIONS: South Africa temporarily banned the sale of tobacco as part of its COVID-19 response. Despite the ban, the sale of cigarettes did not cease; rather, it caused major disruption to the cigarette market. The ban inadvertently benefited manufacturers who were previously disproportionately involved in illicit activities; these manufacturers increased their market share even after the ban was lifted. The ban may have further entrenched South Africa's already large illicit market. Our results show that there are unintended consequences associated with a temporary ban on the sale of cigarettes.

Cigarette Prices and Smoking Among Youth in 16 African Countries: Evidence From the Global Youth Tobacco Survey.

INTRODUCTION: African countries have among the lowest excise taxes in the world. This paper provides new evidence on the association between cigarette prices and youth smoking in 16 African countries. AIMS AND METHODS: We use Global Youth Tobacco Survey (GYTS) cross-country data from approximately 67 500 participants. The relationship between prices and youth smoking in Africa is estimated using probit models for smoking participation and generalized linear models for conditional cigarette demand. Each model is estimated using local-brand and foreign-brand cigarette prices. RESULTS: Higher prices are associated with lower demand across African countries, for both smoking prevalence and the intensity of cigarette consumption by smokers. The estimated price elasticity of participation is -0.70 [95% CI: -1.28 to -0.12] for local-brand cigarettes and -0.71 [95% CI: -0.98 to -0.44] for foreign-brand cigarettes. The price elasticity of conditional cigarette demand is -0.44 [95% CI: -0.76 to -0.12] for local brands and -0.75 [95% CI: -0.96 to -0.53] for foreign brands. The total price elasticity of demand for youth in our sample is -1.14 for local brands and -1.46 for foreign brands. CONCLUSIONS: Higher cigarette prices significantly decrease the likelihood of smoking and decrease the intensity of cigarette consumption among African youths. Increases in the excise tax that increase the retail price of cigarettes will play an important role in reducing youth tobacco use on the continent. Governments are encouraged to increase excise taxes in order to improve public health. IMPLICATIONS: Evidence on the association between cigarette prices and youth smoking in African countries is limited. The Global Youth Tobacco Survey (GYTS) was first introduced in 1999. In 2012, the Centers for Disease Control and Prevention revised the GYTS questionnaire, which removed some questions and introduced new questions into the survey. To the best of our knowledge, there are no published estimates of the relationship between cigarette prices and demand that have used this more recent individual-level GYTS data for African countries. In conducting this analysis, we add to the limited literature on the association between cigarette prices and youth smoking in Africa.

Measuring the illicit cigarette market in the absence of pack security features: a case study of South Africa.

There are several ways to measure the illicit cigarette market. In South Africa, different methods were used to triangulate results. The aim of this paper is to assist researchers to decide which method is most suitable to their context, especially for countries that do not have security features on cigarette packs (eg, tax stamps). We analysed the methods and results from three published articles that used various approaches to measure cigarette illicit trade in South Africa: (1) gap analysis, (2) price threshold method using secondary data from a national survey, and (3) price threshold method using primary data collected in low socioeconomic areas. We provide methodological insights and background information. We discuss the advantages and disadvantages of each method. The method chosen by researchers will depend on data availability, the existence or absence of security features on cigarette packs and funding. Researchers investigating illicit trade should use more than one method to increase confidence in the obtained results.

How much to pay for a track and trace system: a simulation model for South Africa.

BACKGROUND: The illicit trade in tobacco reduces the effectiveness of tobacco-control policies. Independent track and trace (T&T) systems are considered one of the most effective measures available to reduce the illicit tobacco trade. South Africa, with an illicit trade estimated at over 35% of the total market, is yet to implement a T&T system. METHODS: An Excel-based simulation model is used to determine the break-even T&T marker cost per pack. At the break-even cost per pack, the government would recover all costs associated with implementing T&T by collecting additional revenues. We conduct a scenario analysis to provide a range of break-even marker costs. FINDINGS: A marker cost of between R2.68 (US$0.17) and R5.24 (US$0.34) per pack allows the South African government to collect enough additional revenue to recover all costs associated with T&T. Implementing such a system would reduce cigarette consumption by between 5% and 11.5%. Given that comparable systems cost significantly less than this range (roughly US$0.02 per pack), the government would in all likelihood be able to implement a system at a cost below the break-even rate, thus generating additional revenue. CONCLUSION: The break-even simulation model provides a practical tool for the government to plan the implementation of T&T and to set up an evaluation criteria for the T&T tender process. The simulations illustrate that implementing T&T in South Africa would both reduce consumption (licit and illicit) and generate additional revenue. With some modifications, the model can be applied to other countries as well.

The temporary ban on tobacco sales in South Africa: lessons for endgame strategies.

BACKGROUND: The endgame literature recommends that, for a tobacco sales ban to be successful, several demand-side preconditions (eg, low prevalence and effective cessation support) should be in place. The South African Government imposed a ban on the sale of all tobacco and vaping products between 27 March and 17 August 2020, as part of the COVID-19 lockdown. OBJECTIVES: To assess how cigarette smokers responded to the sales ban, to evaluate how the ban impacted the cigarette market in South Africa and to use the South African experience to inform endgame planning. METHODS: Regular preban cigarette smokers completed an online questionnaire from 4 to 19 June 2020 (n=23 631), in which they reported on their prelockdown cigarette smoking patterns, quitting behaviour (if relevant) and smoking behaviour during the ban. RESULTS: About 9% of prelockdown smokers in the sample successfully quit smoking. 93% of continuing smokers purchased cigarettes despite the sales ban. The average price of cigarettes increased by 250% relative to prelockdown prices. Most respondents purchased cigarettes through informal channels. CONCLUSIONS: The demand-side preconditions for an effective sales ban were not in place in South Africa, making a sales ban inappropriate. The South African experience suggests that supply-side factors are also important in ensuring the success of a sales ban. These are: (1) the illicit market must be under control before implementing a sales ban; and (2) an effective sales ban needs to be synchronised with a ban on the manufacture, transport and distribution of cigarettes.

Measuring the effects of the new ECOWAS and WAEMU tobacco excise tax directives.

BACKGROUND: In December 2017, the 15-member ECOWAS (Economic Community of West African States) and the 8-member WAEMU (West African Economic and Monetary Union, a subset of ECOWAS) passed new Tobacco Tax Directives. Both Directives increased the minimum ad valorem excise tax rate to 50%. In addition the ECOWAS Directive introduced a minimum specific tax (US$ 0.02/stick), but the WAEMU Directive did not. This paper examines the likely effects of these new Directives on cigarette prices, sales volumes and revenues. METHOD: Tax simulation models using comparable data were constructed for each of the 15 countries to estimate the effects of the ECOWAS and WAEMU Directives. RESULTS: If the 15 ECOWAS members implement the ECOWAS Directive it would substantially increase the retail price of cigarettes (unweighted average 51%, range: 12% to 108%), decrease sales volumes (22%, range: -8% to -39%) and increase tax revenue (373%, range: 10% to 1243%). The impact of the WAEMU Directive on WAEMU countries' cigarette prices (unweighted average +2%), sales volumes (-1%) and revenue (+17%) is likely to be minimal. CONCLUSIONS: The 2017 ECOWAS Directive, which adds a specific excise tax per pack, along with an increase in the ad valorem tax, substantially improves its members' cigarette tax structure. The specific tax overcomes the weakness of the ad valorem excise tax, since it does not depend on import or ex-factory values, which comprise only a small part of the retail price in ECOWAS countries. We recommend that WAEMU countries adopt the ECOWAS Directive, rather than the WAEMU Directive.

Tobacco farming and current debt status among smallholder farmers in Manicaland province in Zimbabwe.

INTRODUCTION: Zimbabwe is the largest producer of tobacco leaf in Africa and the sixth largest globally. Tobacco leaf is a mainstay of the economy, accounting for about 10% of the country's GDP in 2018. METHODS: We use descriptive and regression analyses from a face-to-face survey of 381 smallholder farmers in three major tobacco-farming areas in Manicaland province to determine the prevalence of tobacco-related debt and some of its covariates. The survey was conducted in June and July 2019. RESULTS: 74% of respondents are contract farmers and 26% are independent farmers. 57% of respondents indicated that they were in tobacco-related debt. The likelihood of being in tobacco-related debt is significantly more than average for farmers with the following characteristics (holding other characteristics constant): being a contract farmer, having a larger farm, employing only family labour and not recording expenses (as a proxy for financial sophistication). 91% of contract farmers would prefer to be independent farmers, while 63% of independent farmers would prefer to be contract farmers. CONCLUSION: There is no evidence to suggest that tobacco growing, in its current state, has benefited the tobacco farmers in Manicaland province. Tobacco farmers are largely victims, rather than beneficiaries, of the sector. There is a strong case for government intervention to improve the conditions of tobacco farmers, either through direct intervention in the tobacco-growing sector, or by encouraging and promoting crop substitution.

Illicit cigarette trade in South Africa: 2002-2017.

BACKGROUND: Increasing cigarette excise taxes is widely recognised as the most effective measure to reduce the demand for cigarettes. The presence of illicit trade undermines the effectiveness of tax increases as both a public health and a fiscal measure, because it introduces cheaper alternatives to legal, full-priced cigarettes. OBJECTIVE: To assess trends in the size of the illicit cigarette market in South Africa from 2002 to 2017 using gap analysis. METHODS: Tax-paid cigarette sales are compared with consumption estimates from two nationally representative surveys: the All Media and Products Survey and the National Income Dynamics Study. We explore the size of the illicit cigarette market and its changes over the period 2002-2017. RESULTS: Since 2009, illicit trade has increased sharply. We estimate that illicit trade is between 30% and 35% of the total market in 2017. The acceleration in the growth of the illicit market since 2015 corresponds with a turbulent time at the South African Revenue Service, when many of the enforcement functions were greatly reduced. CONCLUSIONS: The current levels of illicit trade are extremely high and need to be addressed urgently by implementing effective control mechanisms such as a track and trace system to monitor the production, taxation, and sale of cigarettes.

The illicit cigarette market in six South African townships.

BACKGROUND: We estimate the size of the illicit cigarette market in low socioeconomic areas in South Africa before and after a tax increase. In 2018, the real excise tax increased by 3% and the value-added tax (VAT) rate increased from 14% to 15%. Thus, the real tax on cigarettes increased by 4%. METHODS: A total of 2427 smokers were interviewed over two rounds of data collection (1234 before the tax increase and 1193 after). Data were collected in six townships across four of South Africa's nine provinces. Smokers were asked about their most recent cigarette purchase. Cigarettes purchased for R1 (US$0.08) or less per stick are presumed illicit, based on a threshold price, which includes production costs and taxes. RESULTS: In 2017 and 2018 respectively, 34.6% and 36.4% of smokers in the sample purchased illicit cigarettes. The increase in the proportion of illicit purchases was not statistically significant. Smokers with relatively low socioeconomic status, those who have low levels of education and those who are older or unemployed are most likely to purchase illicit cigarettes. CONCLUSIONS: The illicit cigarette trade in South African townships is widespread. The government should implement an independent track and trace system to curb tax evasion. This would reduce the availability of illicit cigarettes, improve public health and increase excise tax collection.

Tobacco industry tactics in response to cigarette excise tax increases in Mauritius.

BACKGROUND: In response to high smoking rates, especially among men, Mauritius launched a National Action Plan on Tobacco Control in 2008. It changed its tax system from a mixed system to a uniform specific system. Despite these interventions, cigarette consumption and smoking prevalence in Mauritius decreased only marginally in the subsequent decade. METHOD: Using publicly available data, we decompose the retail price of cigarettes into tax and net-of-tax components, between 2011 and 2017. We cover premium, popular and economy cigarettes. RESULTS: Since its introduction in 2008, the nominal excise tax was increased six times. Between 2011 and 2017, the real value of the excise tax increased by 47%. Meanwhile, British American Tobacco (BAT) increased the real net-of-tax price of premium cigarettes by 61.8% and of popular cigarettes by 47.2%, thus overshifting the tax increase. On economy cigarettes, BAT decreased the real net-of-tax price by 14.7%, thus undershifting the excise tax increase. CONCLUSION: Through its pricing strategy, BAT has greatly undermined Mauritius's tobacco control policy. However, BAT cannot continue undershifting the excise tax on economy brands, since the net-of-tax proportion of the retail price is very low already. BAT would have little choice but to increase the retail price on economy brands in response to future excise tax increases. The government of Mauritius is encouraged to keep the specific excise tax structure but to increase the rate at which it is levied.

Analysis of Article 6 (tax and price measures to reduce the demand for tobacco products) of the WHO Framework Convention on Tobacco Control.

OBJECTIVE: To analyse the extent to which parties to the WHO Framework Convention on Tobacco Control (FCTC) have implemented Article 6 since the convention's entry into force. METHODS: Compliance was measured using nine indicators, derived from the 2016 version of the FCTC's reporting instrument's core questionnaire, and the WHO's MPOWER cigarette affordability measure. Data were collected from WHO country profiles, and the 12 country mission reports by the Impact Assessment Expert Group. RESULTS: The number of parties reporting any type of excise tax increased from 87% (134/154) in 2008 to 92% (160/174) in 2016. Specific excise tax systems were implemented by 36% (63/174) of FCTC ratifying countries in 2016, up from 32% (49/154) in 2008. The proportion of parties with mixed tax structures has increased from 25% (39/154) in 2008 to 32% (56/174) in 2016. The proportion of parties that levy the tax as a fully ad valorem tax has decreased from 29% (45/154) in 2008 to 24% (42/174) in 2016. Cigarettes have become less affordable in 46% (78/168), more affordable in 13% (21/168) and unchanged in terms of affordability in 41% (69/168) of parties between 2008 and 2016. The number of parties that earmark tobacco tax revenues for public health increased from 13 in 2008 to 30 in 2016. Many finance ministries are hesitant to increase the excise tax, mainly due to illicit trade concerns. CONCLUSION: While there has been some improvement in tobacco tax policy over time, parties should adopt stronger tax measures, despite industry opposition and threats about illicit trade. Parties should implement FCTC Article 5.3 and ratify the Protocol to Eliminate Illicit Trade in Tobacco Products.

The effect of excise tax increases on cigarette prices in South Africa.

INTRODUCTION: The effectiveness of excise tax increases as a tool for reducing tobacco consumption depends largely on how the tax increases impact the retail price. We estimate this relationship in South Africa for 2001-2015. DATA: Statistics South Africa provided disaggregated cigarette price data, used in the calculation of the Consumers' Price Index. Data on the excise tax per cigarette were obtained from Budget Reviews prepared by the National Treasury of South Africa. METHODS: Regression equations were estimated for each month. The month-on-month change in cigarette prices in February through April was regressed against March's excise tax change to estimate the pass-through coefficient. For the other 9 months, the month-on-month change in cigarette price was regressed against monthly dummy variables to determine the size of the non-tax-related price increase in each of these months. The analysis was performed in both nominal and real (inflation-adjusted) terms. FINDINGS: Expressed in real terms, the excise tax was undershifted. A R1.00 (one rand) increase in the excise tax is associated with an increase in the retail price of cigarettes of R0.90 in the pre-2010 period, and R0.49 in the post-2010 period. In the pre-2010 period, the tobacco industry increased the retail price of cigarettes in July/August, independent of the excise tax increase. The discretionary July/August price increases largely disappeared after 2010, primarily because the market became more competitive. CONCLUSION: The degree of excise tax pass-through, and the magnitude of discretionary increases in cigarette prices, is significantly determined by the competitive environment in the cigarette market.

Energy drink consumption and marketing in South Africa.

Energy drinks are a fast-growing class of beverage containing high levels of caffeine and sugar. Advertising and marketing have been key to their growth in South Africa. This paper documents trends in energy drink consumption and energy drink advertising, and examines the relationship between exposure to energy drink advertising and consumption. Logistic regressions were estimated of categories of energy drink consumption on individual characteristics, as well as exposure to energy drink advertising. Exposure to advertising is measured by reported viewing of channels high in energy drink advertising. Energy drink consumption in South Africa is higher among younger, wealthier males. Spending on energy drink advertising is mostly focused on television. Targeted channels include youth, sports and general interest channels. Viewers of channels targeted by energy drink advertisers have higher odds of any and moderate levels of energy drinks consumption.

Lifestyle and Income-related Inequality in Health in South Africa.

BACKGROUND: Many low- and middle-income countries are experiencing an epidemiological transition from communicable to non-communicable diseases. This has negative consequences for their human capital development, and imposes a growing economic burden on their societies. While the prevalence of such diseases varies with socioeconomic status, the inequalities can be exacerbated by adopted lifestyles of individuals. Evidence suggests that lifestyle factors may explain the income-related inequality in self-reported health. Self-reported health is a subjective evaluation of people's general health status rather than an objective measure of lifestyle-related ill-health. METHOD: The objective of this paper is to expand the literature by examining the contribution of smoking and alcohol consumption to health inequalities, incorporating more objective measures of health, that are directly associated with these lifestyle practices. We used the National Income Dynamic Study panel data for South Africa. The corrected concentration index is used to measure inequalities in health outcomes. We use a decomposition technique to identify the contribution of smoking and alcohol use to inequalities in health. RESULTS: We find significant smoking-related and income-related inequalities in both self-reported and lifestyle-related ill-health. The results suggest that smoking and alcohol use contribute positively to income-related inequality in health. Smoking participation accounts for up to 7.35% of all measured inequality in health and 3.11% of the inequality in self-reported health. The estimates are generally higher for all measured inequality in health (up to 14.67%) when smoking duration is considered. Alcohol consumption accounts for 27.83% of all measured inequality in health and 3.63% of the inequality in self-reported health. CONCLUSION: This study provides evidence that inequalities in both self-reported and lifestyle-related ill-health are highly prevalent within smokers and the poor. These inequalities need to be explicitly addressed in future programme planning to reduce health inequalities in South Africa. We suggest that policies that can influence poor individuals to reduce tobacco consumption and harmful alcohol use will improve their health and reduce health inequalities.

Evaluating South Africa's tobacco control policy using a synthetic control method.

BACKGROUND: South Africa has since 1994 consistently increased the excise tax on cigarettes to maintain a total tax burden of 50% (1997-2003) and 52% (after 2004) of the average retail selling price. Between 1994 and 2004, the real (inflation-adjusted) excise tax increased by 249%, and the average real retail price of cigarettes increased by 110%. In addition, advertising and smoking bans were implemented in 2001. These measures, which we collectively refer to as tax-led, coincided with a 46% decrease in per capita consumption of cigarettes. No evaluation of South Africa's tobacco control policies has created a counterfactual of what would have happened if the tax-led measures had not occurred. OBJECTIVE: (1) To create a credible counterfactual of what would have happened to per capita cigarette consumption if the tax-led measures had not happened. (2) To use this counterfactual to estimate their impact on cigarette consumption in South Africa. METHOD: We use a synthetic control method to create a synthetic South Africa, as a weighted average of countries (the 'donor pool') that are similar to South Africa, but that did not engage in large-scale tobacco control measures between 1990 and 2004. RESULTS: Per capita cigarette consumption would not have continued declining in the absence of the tax-led measures that began in 1994. By 2004, per capita cigarette consumption was 36% lower than it would have been in the absence of the tax-led measures. These results, which we mostly attribute to tax increases, are robust to different specifications of the 'donor pool'. CONCLUSIONS: Significant public health dividends can be obtained by consistently increasing the real tax on cigarettes.

Are the tobacco industry's claims about the size of the illicit cigarette market credible? The case of South Africa.

BACKGROUND: The tobacco industry claims that illicit cigarette trade in South Africa is high and rising. This is often used as an argument not to increase the tobacco excise tax or to regulate tobacco products. OBJECTIVES: To determine how the tobacco industry's estimates of the size of the illicit cigarette market have changed over time. METHODS: Published media articles were obtained from South African Press Cuttings; published articles and press releases were sourced from the internet. The period of interest is 1990-2012. RESULTS: Between 1990 and 2012 we found 90 newspaper articles and press statements that emphasised the tobacco industry's view on illicit trade. Articles that reported on action taken against illicit trade were excluded. Between 2006 and early 2011 the Tobacco Institute of Southern Africa, a body representing the interests of large cigarette companies, reported that South Africa's illicit cigarette market share was 20%. This share increased to 25% in late 2011 and 30% in 2012. In a 2012 presentation by Tobacco Institute of Southern Africa to National Treasury the illicit market share in 2008 was indicated as 7.9%, compared with claims in that year that the illicit market share was 20%. Industry findings that the illicit market decreased in 2007 and 2008 were not reported in the press. CONCLUSIONS: The tobacco industry has adjusted previous estimates of the illicit trade share downwards to create the impression that illicit trade is high and rising. If previous estimates by the tobacco industry were incorrect the credibility of current estimates should be questioned.

Measuring changes in the illicit cigarette market using government revenue data: the example of South Africa.

BACKGROUND: The tobacco industry claims that illicit trade in cigarettes has increased sharply since the 1990s and that government has lost substantial tax revenue. OBJECTIVES: (1) To determine whether cigarette excise tax revenue has been below budget in recent years, compared with previous decades. (2) To determine trends in the size of the illicit market since 1995. METHODS: For (1), mean percentage errors and root mean square percentage errors were calculated for budget revenue deviation for three products (cigarettes, beer and spirits), for various subperiods. For (2), predicted changes in total consumption, using actual cigarette price and GDP changes and previously published price and income elasticity estimates, were calculated and compared with changes in tax-paid consumption. RESULTS: Cigarette excise revenues were 0.7% below budget for 2000-2012 on average, compared with 3.0% below budget for beer and 4.7% below budget for spirits. There is no evidence that illicit trade in cigarettes in South Africa increased between 2002 and 2009. There is a substantial increase in illicit trade in 2010, probably peaking in 2011. In 2012 tax-paid consumption of cigarettes increased 2.6%, implying that the illicit market share decreased an estimated 0.6 percentage points. CONCLUSIONS: Other than in 2010, there is no evidence that illicit trade is significantly undermining government revenue. Claims that illicit trade has consistently increased over the past 15 years, and has continued its sharp increase since 2010, are not supported.