Is it possible to achieve progressive control of tobacco use, one of the leading causes of non-communicable diseases that account for nearly 70% of global deaths, and 77% of premature deaths in the Americas*? Can fiscal policies have a tangible effect in reducing tobacco consumption that reaches 25% in some Latin American countries*?
Today, the South American Network on Applied Economics/Red Sur launched a new research, Tobacco taxes in Latin America, as part of a global project focused on studying the different options for tax policies as an effective tool to reduce the levels of tobacco consumption. The University of Illinois at Chicago’s (UIC) Institute for Health Research and Policy facilitates this global effort on the economics of tobacco through a web-based platform called “Tobacconomics.”
Red Sur will lead Latin-American studies on tobacco taxes, focusing on Argentina, Brazil, Ecuador, Mexico and Peru, where 263.000 people die annually due to tobacco related causes.**
In Latin America, there have been important tax reforms with the goal of reducing tobacco consumption. However, these reforms have often fallen short of the intended purposes. New and additional increases in tobacco taxes have been blocked by concerns about potential negative economic impacts from tobacco tax increases, often fuelled by vested interests from the tobacco industry.
Evidence from around the world shows that higher tobacco taxes and prices, along with other tobacco control policies, such as smoke free laws and selling bans reduce the toll of tobacco related deaths and bring in new revenues, which can finance health and development efforts.
This initiative aims to accelerate these processes and will focus on:
- Alternative strategies for reducing affordability of tobacco products, such as indexation of taxes to offset inflation and rising incomes, with incremental increases.
- Social and economic costs of tobacco use, including healthcare expenditures, lost productivity.
- Supply side effects of increased tobacco taxes, including labor, farming, and/or manufacturing impacts.
- Impacts of increased tobacco taxes on inequality, in particular progressivity and poverty impacts of tobacco production and use.
- Use of tobacco taxation as an instrument to reduce tobacco consumption targeted to support achievement of the Sustainable Development Goals (SDGs).
- Tax administration and compliance aspects related to tobacco taxation including tax avoidance, evasion and illicit trade.
Centro iDeAS, Universidad Nacional de San Martín (UNSAM), Argentina.
Lead researcher: Liliana Alvarado
Research team: Liliana Alvarado, Claudia Córdova and Dalia Toledo
Ethos, Laboratorio de Políticas Públicas
Consequences of special tobacco taxes in Mexico: inequality, consumption and poverty / Efectos de impuestos especiales al tabaco en México: desigualdad, consumo y pobreza
Lead researcher: Luis Huesca Reynoso
Research team: Luis Huesca Reynoso, Cuauhtémoc Calderón Villareal, Linda Irene Llamas Rembao, Guy Lacoix and Abdelkrim Araar
Centro de Investigación en Alimentación and Desarrollo (CIAD)
Evidence and economic analysis for sustainable policies: a tax strategy in Peru / Evidencia y análisis económico para políticas sustentables: una estrategia de impuestos en Perú
Lead researcher: Carlos De los Ríos
Research team: Carlos De los Ríos, Hugo Córdova and Marco Ugarte
Instituto de Estudios Peruanos (IEP)