Published in the journal Tobacco Control, the article looks at tobacco tax increases as a mechanism for controlling tobacco consumption. Tax increases are considered as one of the most effective means to reduce tobacco consumption and its consequences. An increase in taxes results in an increase in the price of tobacco products, thus reducing demand and consumption. Historically, a number of studies have estimated the responsiveness of quantity demanded to a change in price—the price elasticity of demand—of tobacco products in Bangladesh. However, the government’s stronger commitment to reducing tobacco use, rising standards of living, rapidly changing cultural norms due to globalization, and the substantial fall in tobacco use seen in GATS 2017 necessitate an updated measure of price elasticity of tobacco use, to allow for more accurate answers to questions of tobacco tax policy in Bangladesh. The results show that rural households are more responsive to changes in the prices of cigarettes than urban households. Households with low expenditure are found to be more responsive to changes in the price of cigarettes than households with high expenditure. This suggests that increases in cigarette prices at the lower end would effectively reduce cigarette consumption among the people having low expenditure, thus increasing health equity.
Authors: Ahmed, Nasiruddin; Mozumder, Tanvir Ahmed; Hassan, Md. Tariq; Huque, Rumana
Type: Journal Article
Year: 2021
