Effect of increased reliance on specific excise on the consumption of cigarettes

Research has shown that specific tax is more effective in discouraging the behavior of smoking than ad valorem tax. This paper makes use of panel data on 39 countries to investigate the impact of increased reliance on specific tax on cigarette consumption. The data used includes 21 countries, from s...

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Main Author: Kilumelume, Micheal
Other Authors: Walbeek, Corne Van
Format: Dissertation
Language:English
Published: University of Cape Town 2019
Subjects:
Online Access:http://hdl.handle.net/11427/29383
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spelling ndltd-netd.ac.za-oai-union.ndltd.org-uct-oai-localhost-11427-293832020-10-06T05:10:58Z Effect of increased reliance on specific excise on the consumption of cigarettes Kilumelume, Micheal Walbeek, Corne Van Economics Research has shown that specific tax is more effective in discouraging the behavior of smoking than ad valorem tax. This paper makes use of panel data on 39 countries to investigate the impact of increased reliance on specific tax on cigarette consumption. The data used includes 21 countries, from six WHO regions, that increased their reliance on specific tax between 2008 and 2016. The fixed effects and random effects models are employed to estimate the extent to which a change in the specific share of excise tax changes the per capita consumption of cigarettes. According to the results, a one percent increase in the share of specific tax is associated with a 0.16 percent decline in per capita consumption. The findings support the assertion that increased reliance on specific tax results in a more significant decline cigarette consumption. The paper recommends that policymakers should aim to implement a health-driven taxation policy which entails a heavy reliance on specific tax on cigarettes and other tobacco products. However, it is essential to keep in mind that reliance on specific tax may only be useful when adopted with along with other strategies of tobacco control such as combating illicit trade. 2019-02-06T13:04:32Z 2019-02-06T13:04:32Z 2018 2019-02-06T07:48:00Z Master Thesis Masters MCom http://hdl.handle.net/11427/29383 eng application/pdf University of Cape Town Faculty of Commerce School of Economics
collection NDLTD
language English
format Dissertation
sources NDLTD
topic Economics
spellingShingle Economics
Kilumelume, Micheal
Effect of increased reliance on specific excise on the consumption of cigarettes
description Research has shown that specific tax is more effective in discouraging the behavior of smoking than ad valorem tax. This paper makes use of panel data on 39 countries to investigate the impact of increased reliance on specific tax on cigarette consumption. The data used includes 21 countries, from six WHO regions, that increased their reliance on specific tax between 2008 and 2016. The fixed effects and random effects models are employed to estimate the extent to which a change in the specific share of excise tax changes the per capita consumption of cigarettes. According to the results, a one percent increase in the share of specific tax is associated with a 0.16 percent decline in per capita consumption. The findings support the assertion that increased reliance on specific tax results in a more significant decline cigarette consumption. The paper recommends that policymakers should aim to implement a health-driven taxation policy which entails a heavy reliance on specific tax on cigarettes and other tobacco products. However, it is essential to keep in mind that reliance on specific tax may only be useful when adopted with along with other strategies of tobacco control such as combating illicit trade.
author2 Walbeek, Corne Van
author_facet Walbeek, Corne Van
Kilumelume, Micheal
author Kilumelume, Micheal
author_sort Kilumelume, Micheal
title Effect of increased reliance on specific excise on the consumption of cigarettes
title_short Effect of increased reliance on specific excise on the consumption of cigarettes
title_full Effect of increased reliance on specific excise on the consumption of cigarettes
title_fullStr Effect of increased reliance on specific excise on the consumption of cigarettes
title_full_unstemmed Effect of increased reliance on specific excise on the consumption of cigarettes
title_sort effect of increased reliance on specific excise on the consumption of cigarettes
publisher University of Cape Town
publishDate 2019
url http://hdl.handle.net/11427/29383
work_keys_str_mv AT kilumelumemicheal effectofincreasedrelianceonspecificexciseontheconsumptionofcigarettes
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