The Spanish tobacco tax loopholes and their consequences

Objectives: The Spanish Government has strengthened tobacco control policies since 2005, including changes in tobacco taxes. Because these changes have targeted cigarettes mainly, the tobacco industry has marketed cheaper alternative tobacco products, offering smokers the possibility to down-trade....

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Detalles Bibliográficos
Autores: López Nicolás, Ángel, Cobacho Tornel, María Belén, Fernández, Esteve
Tipo de recurso: artículo
Estado:Versión aceptada para publicación
Fecha de publicación:2013
País:España
Institución:Universidad Politécnica de Cartagena(UPCT)
Repositorio:Repositorio Digital UPCT
OAI Identifier:oai:repositorio.upct.es:10317/4441
Acceso en línea:http://hdl.handle.net/10317/4441
Access Level:acceso abierto
Palabra clave:Taxes
Cigarettes
Fine cut tobacco
Down-trading
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spelling The Spanish tobacco tax loopholes and their consequencesLópez Nicolás, ÁngelCobacho Tornel, María BelénFernández, EsteveTaxesCigarettesFine cut tobaccoDown-tradingObjectives: The Spanish Government has strengthened tobacco control policies since 2005, including changes in tobacco taxes. Because these changes have targeted cigarettes mainly, the tobacco industry has marketed cheaper alternative tobacco products, offering smokers the possibility to down-trade. This paper traces the evolution of patterns of demand for cigarettes and other tobacco products in Spain over the period 2005-2011 in order to assess the impact of such tax loopholes. Methods: We use data on tobacco products prices and sales as well as changes in the structure and levels of tobacco taxes to relate tax changes to price changes and subsequent market share changes. Results: Tax reforms have lifted the bottom end of the cigarette price distribution, but the industry has been successful in marketing fine cut tobacco at cheap prices. There have been partial attempts to correct this asymmetric tax treatment, but these have not avoided a remarkable increase in the market share of fine cut tobacco. The absence of a minimum tax on quantity for the rest of tobacco products allows the industry to place them as potential future down-trading vehicles. Conclusions: In order to address public health objectives, tax policies should aim to equalise the cost of smoking across different tobacco products. Otherwise the tobacco industry can exploit tax loopholes to market cheap alternatives to cigarettes. This requires all tobacco products to bear a minimum tax on quantity, whose levels need to be adjusted in order to reflect the equivalence between different forms of smoking.Support by Ministerio de Educación, project ECO2008-06395-C05-04, co-funded by European Regional Development Fund, and Fundación Séneca through project 08646/PHCS/08 is gratefully acknowledged (A. López-Nicolás and MB. Cobacho). Support by Instituto de Salud Carlos III, Government of Spain (RTICC RD06/0020/0089) and Ministry of Universities and Research, Government of Catalonia (Grant 2009SGR192) is gratefully acknowledged (E. Fernández).BMJ Journals201520152013info:eu-repo/semantics/articleinfo:eu-repo/semantics/acceptedVersionapplication/pdfapplication/pdfhttp://hdl.handle.net/10317/4441reponame:Repositorio Digital UPCTinstname:Universidad Politécnica de Cartagena(UPCT)InglésAtribución-NoComercial-SinDerivadas 3.0 Españahttp://creativecommons.org/licenses/by-nc-nd/3.0/es/info:eu-repo/semantics/openAccessoai:repositorio.upct.es:10317/44412026-05-15T06:39:02Z
dc.title.none.fl_str_mv The Spanish tobacco tax loopholes and their consequences
title The Spanish tobacco tax loopholes and their consequences
spellingShingle The Spanish tobacco tax loopholes and their consequences
López Nicolás, Ángel
Taxes
Cigarettes
Fine cut tobacco
Down-trading
title_short The Spanish tobacco tax loopholes and their consequences
title_full The Spanish tobacco tax loopholes and their consequences
title_fullStr The Spanish tobacco tax loopholes and their consequences
title_full_unstemmed The Spanish tobacco tax loopholes and their consequences
title_sort The Spanish tobacco tax loopholes and their consequences
dc.creator.none.fl_str_mv López Nicolás, Ángel
Cobacho Tornel, María Belén
Fernández, Esteve
author López Nicolás, Ángel
author_facet López Nicolás, Ángel
Cobacho Tornel, María Belén
Fernández, Esteve
author_role author
author2 Cobacho Tornel, María Belén
Fernández, Esteve
author2_role author
author
dc.subject.none.fl_str_mv Taxes
Cigarettes
Fine cut tobacco
Down-trading
topic Taxes
Cigarettes
Fine cut tobacco
Down-trading
description Objectives: The Spanish Government has strengthened tobacco control policies since 2005, including changes in tobacco taxes. Because these changes have targeted cigarettes mainly, the tobacco industry has marketed cheaper alternative tobacco products, offering smokers the possibility to down-trade. This paper traces the evolution of patterns of demand for cigarettes and other tobacco products in Spain over the period 2005-2011 in order to assess the impact of such tax loopholes. Methods: We use data on tobacco products prices and sales as well as changes in the structure and levels of tobacco taxes to relate tax changes to price changes and subsequent market share changes. Results: Tax reforms have lifted the bottom end of the cigarette price distribution, but the industry has been successful in marketing fine cut tobacco at cheap prices. There have been partial attempts to correct this asymmetric tax treatment, but these have not avoided a remarkable increase in the market share of fine cut tobacco. The absence of a minimum tax on quantity for the rest of tobacco products allows the industry to place them as potential future down-trading vehicles. Conclusions: In order to address public health objectives, tax policies should aim to equalise the cost of smoking across different tobacco products. Otherwise the tobacco industry can exploit tax loopholes to market cheap alternatives to cigarettes. This requires all tobacco products to bear a minimum tax on quantity, whose levels need to be adjusted in order to reflect the equivalence between different forms of smoking.
publishDate 2013
dc.date.none.fl_str_mv 2013
2015
2015
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dc.identifier.none.fl_str_mv http://hdl.handle.net/10317/4441
url http://hdl.handle.net/10317/4441
dc.language.none.fl_str_mv Inglés
language_invalid_str_mv Inglés
dc.rights.none.fl_str_mv Atribución-NoComercial-SinDerivadas 3.0 España
http://creativecommons.org/licenses/by-nc-nd/3.0/es/
info:eu-repo/semantics/openAccess
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dc.publisher.none.fl_str_mv BMJ Journals
publisher.none.fl_str_mv BMJ Journals
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