Modeling the potential impact of a sugar-sweetened beverage tax on ischemic heart disease and stroke in Brazil.

BACKGROUND: A high intake of sugar-sweetened beverages (SSBs) is associated with the risk of several chronic diseases, including ischemic heart disease (IHD) and stroke. This study aimed to model the impact of a 20% tax on all SSBs for IHD and stroke among Brazilian adults. METHODS: This was an ex-ante risk comparative study. The model applied a 20% tax on SSBs and projected the incidence, prevalence and mortality of IHD and stroke over a 20-year period (2019-39). Using data on consumption, previously published cross- and own-price elasticities of SSBs, and relative risk, we estimated changes in IHD and stroke burden. RESULTS: Our model predicts that a 20% SSB tax may reduce new cases of IHD by ~13%, especially among women, and avert ~8% of the deaths attributable to IHD over 20 years. These results represent a decrease of 19 543 new cases and 8466 and 7274 fewer deaths in the period for men and women, respectively. Estimates of reduction in incidence, prevalence and deaths from stroke were not significant over 20 years. CONCLUSIONS: Even under conservative assumptions, our study found that a small reduction in SSB consumption led to a substantial decrease in IHD incidence and mortality in Brazil.

Fiscal austerity and municipal health spending: an interrupted time series study / Austeridade fiscal e gastos municipais em saúde: estudo de séries temporais interrompidas

ABSTRACT OBJECTIVE To analyze the impact of the fiscal austerity policy (PAF) on health spending in Brazilian municipalities, considering population size and source of funds. METHODS The interrupted time series method was used to analyze the effect of the PAF on total expenditure, resources transferred by the Federal Government, and own/state per capita resources allocated to health in the municipalities. The time series analyzed covered the period from 2010 to 2019, every six months. The first semester of 2015 was adopted as the start date of the intervention. The municipalities were grouped into small (up to 100,000 inhabitants), medium (101,000 to 400,000 inhabitants), and large (over 400,000 inhabitants). The data was obtained from the Sistema de Informações sobre Orçamentos Públicos em Saúde (Information System on Public Health Budget). RESULTS The results for the national average of municipalities show that the PAF had a negative impact on the level of total expenditure and own/state resources allocated to health in the first half of 2015, without causing statically significant changes in the trends of any of the indicators analyzed in the period after 2015. Small municipalities saw a drop in total expenditure, while large municipalities saw a drop in own/state resources, and medium-sized municipalities saw a drop in both variables. There was no statistically significant drop in the volume of funds transferred by the Federal Government in the immediate aftermath of the implementation of the PAF in any of the municipal groups analyzed. In the medium-term, the PAF only had a negative impact on the large municipalities, which saw significant reductions in the trends of own/state resources and those transferred by the Union for health. CONCLUSION In general, the impact of the PAF on health financing in municipalities was immediate and based on the decrease in own/state resources allocated to health. In large municipalities, however, the impact lasted from 2015 to 2019, mainly affecting health expenditure from federal funds.

RESUMO OBJETIVO Analisar o impacto da política de austeridade fiscal (PAF) nas despesas em saúde dos municípios brasileiros, levando em consideração o porte populacional e a fonte dos recursos. MÉTODOS Utilizou-se o método de séries temporais interrompidas para analisar o efeito da PAF sobre as despesas totais, recursos transferidos pela União e recursos próprios/estaduais per capita destinados à saúde nos municípios. A série temporal analisada compreendeu o período de 2010 a 2019, com periodicidade semestral. Adotou-se o primeiro semestre de 2015 como data de início da intervenção. Os municípios foram agregados em pequenos (até 100 mil habitantes), médios (101 mil a 400 mil habitantes) e grandes (mais de 400 mil habitantes). Os dados foram obtidos no Sistema de Informações sobre Orçamentos Públicos em Saúde. RESULTADOS Os resultados para a média nacional dos municípios demonstram que a PAF teve um impacto negativo sobre o nível de despesas totais e de recursos próprios/estaduais destinados à saúde no primeiro semestre de 2015, não provocando mudanças estaticamente significativas nas tendências de nenhum dos indicadores analisados no período posterior a 2015. Municípios pequenos tiveram queda nas despesas totais, enquanto os grandes, nos recursos próprios/estaduais e os médios, em ambas as variáveis. Não houve queda estatisticamente significante no volume de recursos transferidos pela União no momento imediato à implementação da PAF em nenhum dos grupos municipais analisados. No médio prazo, a PAF gerou impacto negativo apenas nos grandes municípios, que tiveram reduções significativas nas tendências de recursos próprios/estaduais e transferidos pela União destinados à saúde. CONCLUSÃO No geral, o impacto da PAF no financiamento da saúde dos municípios se deu de forma imediata e a partir da queda de recursos próprios/estaduais destinados à saúde. Nos municípios grandes, entretanto, o impacto foi perdurável entre 2015 e 2019, afetando, principalmente, as despesas com saúde oriundas de recursos da União.

Rethinking fiscal rules.

The Covid 19 pandemic has caused both a decrease in tax revenues and an increase in public spending, forcing governments to increase fiscal deficits to unprecedented levels. Given these circumstances, it is foreseeable that fiscal rules will play a predominant role in the design of many countries' recovery policies. We develop a general equilibrium, overlapping generations model for a small, open economy in order to study the impact of several fiscal rules upon welfare, public expenditures and growth. We calibrate the model to the Peruvian economy. In this economy, fiscal rules have been widely used and, unlike in other Latin American countries, they have been relatively successful. We find that fiscal rules will generate better results in terms of output if, in addition to maintaining control over the fiscal result, they also preserve public investment. We also find that the performance of economies that implement structural rules tends to be better than the performance of economies that implement rules based on realized budget balance.

The Potential Impact of Different Taxation Scenarios towards Sugar-Sweetened Beverages on Overweight and Obesity in Brazil: A Modeling Study.

The adoption of fiscal policies based on the specific taxation of sugar-sweetened beverages (SSBs) has been recommended by international health agencies, as they are measures that potentially reduce consumption. This study is an ex ante risk comparison that estimates the impact of three tax scenarios (20, 25, and 30%) with a 100% pass-on rate to SSBs on the prevalence of high weight and obesity in the Brazilian population. Data on the consumption habits, weight, and height of 46,164 adults aged 20 years or over from Brazilian recent national surveys were used. The shift in consumption after taxation was estimated based on the price elasticity of the demand. The percentage changes in overweight for 20, 25, and 30% taxation were 1.84% (95%CI: 1.82; 1.86), 1.89% (95%CI: 1.87; 1.90), and 2.25% (95%CI: 2.24; 2.27), respectively. The change in the prevalence of obesity was 1.93% (95%CI: 1.87; 2.00), 2.90% (95%CI: 2.80; 3.02), and 4.16% (95%CI: 4.01; 4.32), respectively. Taxes on SSBs may have a more favorable result among the heaviest consumers, who are young adults (20-29 years), especially men, thereby promoting a greater reduction in the prevalence of high weight and obesity.

Impact of a reduction in sugar-sweetened beverage consumption on the burden of type 2 diabetes in Brazil: A modeling study.

AIM: To model the impact of a 20 % tax on sugar-sweetened beverages (SSBs) on the disease burden of T2DM among Brazilian adults. METHODS: This is an ex-ante risk comparative study. The model applied a 20 % tax on SSB and projected the incidence, prevalence, and mortality of T2DM over a 20-year period (2019 to 2039). Using recent national data on consumption, previously published cross- and own-price elasticities of SSBs and diabetes relative risk we estimated changes on T2DM burden. RESULTS: With a 20 % tax on SSBs, after 10 years, we estimated a reduction of 37,303 new cases of T2DM for men and 56,757 for women; 184,129 prevalent cases for men and 219,236 for women; and 5,386 and 6,075 deaths for men and women, respectively. After 20 years, 8.6 % and 12.4 % new cases of T2DM will have been prevented, 4.0 % and 5.5 % prevalent cases, and 13.7 % and 12.7 % deaths among men and women, respectively. CONCLUSIONS: SSB taxes have the potential to reduce the burden of and deaths attributable to T2DM. Our results show that a fiscal policy may significantly impact strategic plans to tackle noncommunicable diseases.

Financiamento da saúde e dependência fiscal dos municípios brasileiros entre 2004 e 2019 / Financing of health and the fiscal dependency of Brazilian municipalities between 2004 and 2019

Resumo Este artigo descreve a evolução do financiamento municipal do Sistema Único de Saúde, de 2004 a 2019, considerando receitas e despesas de fontes próprias e não-próprias, analisa a redistribuição fiscal, de acordo com o porte populacional e a renda média domiciliar, e compara essa evolução em dois períodos, caracterizados como de crescimento econômico (2004-2014) e de recessão (2015-2019). O estudo se baseou em dados do Sistema de Informações sobre Orçamentos Públicos em Saúde. Constatou-se crescimento real dos gastos municipais em saúde de 2004 a 2014 (156,3%), com queda entre 2014 e 2015, seguida de recuperação até 2019. Na recessão, detectou-se aumento global da dependência fiscal dos municípios, indicada pelo aumento de receitas não-próprias, mesmo com a diminuição da participação da União nas transferências. O crescimento das despesas próprias em saúde foi menor entre os municípios de menor renda domiciliar, enquanto para as despesas não-próprias foi maior nos municípios de menor porte populacional. Em suma, indica-se um processo de incremento dos gastos municipais em saúde, assim como o aumento da dependência fiscal para custeio da saúde, intensificado após a crise de 2015, que atingiu especialmente os municípios de pequeno porte e de menor renda domiciliar.

Abstract This article describes the evolution of municipal financing of the Unified Health System, from 2004 to 2019, considering revenues and expenses from own and non-own sources, analyzes fiscal redistribution, according to population size and average household income, and compares this evolution in two periods, characterized as economic growth (2004-2014) and recession (2015-2019). The study was based on data from the Information System on Public Health Budgets. There was real growth in municipal spending on health from 2004 to 2014 (156.3%), with a drop between 2014 and 2015, followed by a recovery between 2015 and 2019. During the recession period, there was an overall increase in the fiscal dependence of municipalities, indicated by the increase in non-own revenues, even with the decrease in the Federal Government participation in transfers. The growth of own health expenses was lower among municipalities with lower household income, while for non-own expenses it was higher in municipalities with a smaller population size. In short, the results indicate a process of increasing municipal spending on health, as well as the increased fiscal dependence of municipalities to fund health, intensified after the 2015 crisis, which especially affected small and lower income municipalities.

Taxing sugar-sweetened beverages as a policy to reduce overweight and obesity in countries of different income classifications: a systematic review.

OBJECTIVE: To evaluate the potential impact of sugar-sweetened beverage (SSB) taxes on overweight and obesity prevalence in countries of different income classifications. DESIGN: Systematic review following Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines (PROSPERO number CRD42020161612). Five databases (Cochrane Library, Embase, LILACS (via Virtual Health Library) and MEDLINE (via PubMed), and Web of Science were searched, from January 2009 to December 2019. Articles that reported changes in purchases, sales, intake, body weight, BMI, overweight and/or obesity prevalence due to a tax on or price change in SSB were included. SETTING: Studies conducted in countries of different income classifications. PARTICIPANTS: The search yielded 8349 articles of which 21 met inclusion criteria. RESULTS: Among the sixteen studies selected, only two did not show that consumption, sales and purchase decreased as the price of SSB increased. In eight of the thirteen studies selected, a positive effect of an SSB tax on decreasing overweight and obesity prevalence was expected. It is estimated that a 20 % taxation on SSB would result in a greater decrease in the prevalence of overweight and obesity compared to a 10 % rate. Studies with no significant effect of taxing on sales, purchases, consumption and prevalence of obesity were from high-income countries, while significant effects of taxing on reducing purchase, consumption and/or obesity prevalence were found in studies from upper-middle- and middle-income countries. CONCLUSION: A high SSB tax might be an effective fiscal policy to decrease purchase and consumption of SSB and reduce overweight/obesity prevalence, especially if the tax were specific for beverage volume.

Measuring cost and affordability of current vs. healthy diets in Argentina: an application of linear programming and the INFORMAS protocol.

BACKGROUND: Food cost and affordability is one of the main barriers to improve the nutritional quality of diets of the population. However, in Argentina, where over 60% of adults and 40% of children and adolescents are overweight or obese, little is known about the difference in cost and affordability of healthier diets compared to ordinary, less healthy ones. METHODS: We implemented the "optimal approach" proposed by the International Network for Food and Obesity/non-communicable diseases Research, Monitoring and Action Support (INFORMAS). We modelled the current diet and two types of healthy diets, one equal in energy with the current diet and one 6.3% lower in energy by linear programming. Cost estimations were performed by collecting food product prices and running a Monte Carlo simulation (10,000 iterations) to obtain a range of costs for each model diet. Affordability was measured as the percentage contribution of diet cost vs. average household income in average, poor and extremely poor households and by income deciles. RESULTS: On average, households must spend 32% more money on food to ensure equal energy intake from a healthy diet than from a current model diet. When the energy intake target was reduced by 6.3%, the difference in cost was 22%. There are no reasonably likely situations in which any of these healthy diets could cost less or the same than the current unhealthier one. Over 50% of households would be unable to afford the modelled healthy diets, while 40% could not afford the current diet. CONCLUSIONS: Differential cost and affordability of healthy vs. unhealthy diets are germane to the design of effective public policies to reduce obesity and NCDs in Argentina. It is necessary to implement urgent measures to transform the obesogenic environment, making healthier products more affordable, available and desirable, and discouraging consumption of nutrient-poor, energy-rich foods.

Effects of a sugar-sweetened beverage tax on prices and affordability of soft drinks in Chile: A time series analysis.

Chile is one of several countries that recently implemented a fiscal policy to reduce soft drink (SD) intake and obesity. In 2014 the government increased the existing ad-valorem tax on high-sugar SD by 5% and decreased by 3% the tax on low-sugar SD, based on a 6.25gr/100 ml sugar threshold. This study aims to evaluate the tax modification passed-on to consumers through prices, and to calculate changes in affordability of SDs. We analysed nationally representative consumer price index data of 41 soft drinks within 6 beverage categories between 2009 and 2016. Price change post-tax implementation was estimated for different categories (carbonates, juices, concentrates, waters and energy-sport drinks), using time-series analyses. In addition, changes in affordability were evaluated by estimating the changes in prices relative to wages. The price of carbonates increased by 5.60% (CI 95% 3.18-8.03%) immediately after the tax was implemented. A sustained increase in the prices of concentrates was observed after the implementation. Unexpectedly, a smaller increase was also seen for the price of bottled water - a category that saw no tax change. There were no effects for juices and energy-sports drinks. There was a reduction in affordability for carbonates, concentrates and waters. Overall, the fiscal policy was effective in increasing prices and there are some signs of reduced affordability. Results varied substantially among categories directly affected by the tax policy. While for carbonates the price increase exceeded the tax change ('over-shifting'), in other categories subject to a tax cut, a price reduction was expected but the opposite occurred. As the effect of the tax on prices differed between categories, the effects of the tax policy on consumption patterns are likely to be mixed. Our findings underline the need to better understand and anticipate price setting behaviour of firms in response to a tax.

Efeitos do programa de Nota Fiscal eletrônica sobre o aumento da arrecadação do Estado / Efectos del programa de la Factura Electrónica sobre el aumento de la recaudación en el estado / Effects of the electronic invoice program on the increase of state collection

Resumo O objetivo deste artigo é verificar se a implantação do programa de Nota Fiscal eletrônica (NF-e) gerou como consequência algum incremento na arrecadação do Estado de Goiás. Para tanto, utilizaram-se testes de médias e estimação de regressões difference-in-differences. Os resultados indicaram que a média de arrecadação no Estado de Goiás é estatisticamente superior no período posterior à implantação da NF-e e que o aumento da arrecadação das empresas obrigadas a emitir NF-e foi maior do que o daquelas que não são obrigadas. Assim, apesar do foco principal da NF-e não ser o aumento da arrecadação, pode-se observar que a institucionalização de um programa para padronização e compartilhamento dos documentos fiscais incluiu melhorias nos processos de fiscalização da administração tributária, aumentando a arrecadação do Estado por meio da redução da inadimplência.

Resumen El objetivo de este artículo es verificar si la implementación del programa de Factura Electrónica (NF-e, por sus siglas en portugués) generó, como consecuencia, algún aumento en la recaudación en el estado de Goiás. Para la investigación, se utilizaron pruebas de promedios y estimación de regresiones de diferencia en diferencias (difference-in-differences). Los resultados indicaron que el promedio de recaudación en el estado de Goiás es estadísticamente superior en el período posterior a la implantación de la NF-e y el aumento de la recaudación de las empresas obligadas a emitir NF-e fue mayor que el de las que no son obligadas. Así, aunque el enfoque principal de la NF-e no es el aumento de la recaudación de impuestos, se puede observar que la institucionalización de un programa de estandarización y compartición de documentos fiscales incluyó mejoras en los procesos de fiscalización de la administración tributaria, aumentando la recaudación de impuestos del Estado a través de la reducción de la morosidad fiscal.

Abstract This article aims to verify if the implementation of the Electronic Invoice program (EI), generated an increase in the collection in the state of Goiás, Brazil. For the research, means test analysis (t-test) was used along with the estimation of regressions difference-in-differences. The results indicated that the average collection in the state of Goiás was statistically higher in the period after the implementation of EI and that the increase in the collection from companies required to issue EI was superior to the collection from those not required to during the period of investigation. Therefore, although the main focus of EI is not the increase in tax collection, it can be observed that the institutionalization of a program of standardization and sharing of fiscal documents included improvements in the inspection processes of the tax administration, increasing the collection of state taxes through the reduction of tax default.

Assessing the impact of the Barbados sugar-sweetened beverage tax on beverage sales: an observational study.

BACKGROUND: The World Health Organization has advocated for sugar-sweetened beverage (SSB) taxes as part of a broader non-communicable disease prevention strategy, and these taxes have been recently introduced in a wide range of settings. However, much is still unknown about how SSB taxes operate in various contexts and as a result of different tax designs. In 2015, the Government of Barbados implemented a 10% ad valorem (value-based) tax on SSBs. It has been hypothesized that this tax structure may inadvertently encourage consumers to switch to cheaper sugary drinks. We aimed to assess whether and to what extent there has been a change in sales of SSBs following implementation of the SSB tax. METHODS: We used electronic point of sale data from a major grocery store chain and applied an interrupted time series (ITS) design to assess grocery store SSB and non-SSB sales from January 2013 to October 2016. We controlled for the underlying time trend, seasonality, inflation, tourism and holidays. We conducted sensitivity analyses using a cross-country control (Trinidad and Tobago) and a within-country control (vinegar). We included a post-hoc stratification by price tertile to assess the extent to which consumers may switch to cheaper sugary drinks. RESULTS: We found that average weekly sales of SSBs decreased by 4.3% (95%CI 3.6 to 4.9%) compared to expected sales without a tax, primarily driven by a decrease in carbonated SSBs sales of 3.6% (95%CI 2.9 to 4.4%). Sales of non-SSBs increased by 5.2% (95%CI 4.5 to 5.9%), with bottled water sales increasing by an average of 7.5% (95%CI 6.5 to 8.3%). The sensitivity analyses were consistent with the uncontrolled results. After stratifying by price, we found evidence of substitution to cheaper SSBs. CONCLUSIONS: This study suggests that the Barbados SSB tax was associated with decreased sales of SSBs in a major grocery store chain after controlling for underlying trends. This finding was robust to sensitivity analyses. We found evidence to suggest that consumers may have changed their behaviour in response to the tax by purchasing cheaper sugary drinks, in addition to substituting to untaxed products. This has important implications for the design of future SSB taxes.

Inequality and fiscal policies in Uruguay by race.

The aim of this study is to analyze the effect of fiscal policy by race, disaggregating to consider Uruguayans with primarily European, African and indigenous ancestry. We perform an incidence analysis, an estimation of the effect of fiscal policy on the poverty exit rate and an assessment of the impact on the average ethno-racial gaps. The findings support the idea that fiscal policy reduces (but does not eliminate) ethnic gaps. This result is led by health care and educational transfers, and to a lesser degree by direct transfers. We do not consider quality issues with public services, which may affect the estimated narrowing of gaps. Finally, we find that Afro-descendants and indigenous individuals do not capture the full potential of education transfers because of their high drop-out rate.

Lei de Responsabilidade Fiscal e as despesas com pessoal da saúde: uma análise da condição dos municípios brasileiros no período de 2004 a 2009 / Fiscal Responsibility Law and expenditure on health personnel: an analysis of the condition of Brazilian municipalities from 2004 to 2009

Resumo Os limites para as despesas com pessoal impostos pela Lei de Responsabilidade Fiscal (LRF) têm sido apontados pelos gestores municipais de saúde como obstáculo à política do setor. O artigo analisa a tendência linear dos indicadores de despesas com pessoal e a correlação deste com o perfil de gastos com pessoal da saúde de 5.356 municípios brasileiros, entre 2004 e 2009. O estudo, de série temporal, recorreu aos dados do Finanças do Brasil (Finbra) e do Sistema de Informações sobre Orçamentos Públicos em Saúde (Siops). Observou-se uma tendência de aumento de 1,3% nas médias anuais da despesa total com pessoal dos municípios, porém as despesas com pessoal da saúde não acompanharam esse crescimento. Não houve correlação entre os indicadores, portanto, esse resultado se opõe aos argumentos dos gestores de saúde, que atribuem à LRF os problemas para contratação de trabalhadores e expansão dos sistemas de saúde. A disponibilidade de dados dos sistemas Finbra e Siops associado à carência de conhecimento sobre o assunto tornam oportunas novas pesquisas.

Abstract The limits for expenditure on personnel that were imposed by the Fiscal Responsibility Act (FRA) have been considered by local health managers as an obstacle to health sector policies. This paper analyzes the linear trend for the personnel expenses indicators and the correlation of this with the profile of spending on health care personnel in 5,356 Brazilian municipalities from 2004 to 2009. The study of the time series used data from the ‘Finanças do Brasil’ (Finbra) and data from the Information System on Public Health Budgets (SIOPS). There was a trend towards an increase of 1.3% in the annual average of total personnel expenditure in the municipalities, but the cost of health care staff did not follow that growth. There were no correlations between the indicators, and this result is contrary to the arguments given by the health managers. They attribute the problems with hiring workers and the expansion of health systems to the FRA. The availability of data from the Finbra and the Siops system is associated with a lack of knowledge on these issues. This makes it an opportune time for conducting new research.

Política fiscal, asequibilidad y efectos cruzados de precios en la demanda de productos de tabaco: el caso de Uruguay / Fiscal policy, affordability and cross effects in the demand for tobacco products: the case of Uruguay

Uruguay es un país que desde 2005 ha realizado una política activa de control del tabaco. Sin embargo, la evolución de la demanda del total de productos de tabaco muestra un descenso insignificante en los últimos cinco años, lo que es contrario a lo esperado. La hipótesis es que el fuerte crecimiento del ingreso de los hogares unido a una elasticidad-ingreso de la demanda de cigarrillos cercana a 1 fue uno de los factores que contrarrestó el aumento real en los precios vía impuestos. El aumento en el ingreso de los hogares fue de 36 por ciento en términos reales en el periodo 2005-2009 debido a la fuerte recuperación luego de la crisis del año 2002. Por otro lado, un segundo factor explicativo importante de la demanda de cigarrillos en el Uruguay es la sustituibilidad entre cigarrillos y tabaco de armar. El impuesto y precio del tabaco de armar sigue siendo sustancialmente más bajo que el del cigarrillo, de forma que en los últimos años la cantidad demandada de tabaco de armar ha subido. El trabajo consistió entonces en revisitar un estudio de demanda realizado en 2004 por los autores y volver a estimar una función demanda de los dos productos principales de tabaco en el Uruguay (cigarrillos y tabaco de armar), lo que permite estimar las elasticidades precio, ingreso y cruzadas. A partir de estas estimaciones se realiza un ejercicio de simular alternativas de incrementos de impuestos con lo que se evalúa qué aumentos son necesarios para realmente impactar sobre la demanda en un escenario de crecimiento del ingreso de los hogares moderado de 2.5 por ciento anual y alto de 5 por ciento anual. Se confirma que se necesitan aumentos de impuestos muy superiores a los verificados en el último quinquenio.

Uruguay, a country with a solid tobacco control policy since 2005 shows, contrary to expectations, an insignificant decrease in total tobacco products' sales in the last five years. The hypothesis is that on one side, changes in household income and the income elasticity of the demand for cigarettes were important countervailing factors in the demand of both products. The period 2005-2009 shows a large increase of 36 percent in household real income in Uruguay due to fast economic recovery after the 2002 crisis. The second factor is the interchangeability of roll your own and cigarettes and the impact on the demand of each product as a reaction to tax and price changes. The tax and price of roll your own tobacco remains substantially lower than that of cigarettes. This fact, and the increased substitution of roll your own for cigarettes seems to be the main reasons for the low impact of the policy of tobacco tax and price increases. This paper then consists of a revision of a 2004 study to estimate separate demands for both main tobacco products and obtain estimates for own price, cross price and income elasticities. Then, a simulation study was performed using the elasticities found and two scenarios of increases in household income: moderate (2.5 percent per year) and high (5 percent per year) confirming that countries where income is growing fast and with a potential for substitution towards cheaper products require substantial cigarette tax and price increases for a fiscal tobacco control policy to become effective.