TY - JOUR
T1 - Indexation of tobacco excise and customs duty and smoking prevalence among Australian adults, 2001-2010
T2 - A Serial Cross-sectional Study
AU - Wilkinson, Anna L.
AU - Scollo, Michelle
AU - Durkin, Sarah J.
AU - Bayly, Megan
AU - Spittal, Mathew J.
AU - Chaloupka, Frank J.
AU - Wakefield, Melanie A.
N1 - Funding Information:
This work was supported by Cancer Council Victoria. MAW was supported by an Australian National Health and Medical Research Council Principal Research Fellowship.
Publisher Copyright:
© The Author(s) 2018. Published by Oxford University Press on behalf of the Society for Research on Nicotine and Tobacco. All rights reserved.
PY - 2019/3
Y1 - 2019/3
N2 - Introduction: Australia's excise and customs duty on tobacco has been automatically increased biannually since 1984. Increases in duty on par with inflation ensured that tobacco stayed at least as costly as other goods.This would be expected to maintain, rather than drive down, smoking prevalence. We examined the association between smoking prevalence and duty over a 10-year period. Methods: Using monthly data from five Australian capital cities, collected from March 2001 to March 2010 among Australians aged at least 18 years, multiple linear regression modeled associations between smoking prevalence and the two components (duty and non-duty) of the recommended retail price of an average packet of cigarettes, adjusting for policy covariates. Results: Prevalence declined from 23.6% in March 2001 to 17.0% in March 2010 [absolute difference 6.6%; 95% confidence interval (CI) = 6.5 to 6.8]. Duty increased from $0.2026 to $0.2622 per cigarette over the same period. In the adjusted model, a 1-cent increase in the duty component of price was not associated with changes in prevalence (0.019; 95% CI = −0.035 to 0.028). Increased non-duty component of price was associated with a decline in prevalence (−0.027; 95% CI = −0.052 to −0.002).This effect was stronger when changes in income were controlled for. Conclusions: In line with expectations, inflation-adjusted duty was not associated with changes in smoking prevalence, but it may have prevented upward pressure on prevalence that increasing affordability could have exerted. Frequent increases in duty greater than the growth in both wages and goods would more effectively reduce smoking than regular indexation. Implications: Few countries inflation-adjusted excise duty to ensure that tobacco products do not become more affordable; however, Australia experienced a decade of inflation adjustment alone, enabling the impact of this policy to be studied.This study shows that inflation-adjusted duty likely did prevent tobacco becoming more affordable and that indexation was associated with declines in smoking when tobacco companies over-shifted the duty rises (ie, increased price over and above duty rises).The study also suggests that frequent increases in taxation that exceed both wage growth and increases in costliness of other goods are needed to prompt increased rates of quitting.
AB - Introduction: Australia's excise and customs duty on tobacco has been automatically increased biannually since 1984. Increases in duty on par with inflation ensured that tobacco stayed at least as costly as other goods.This would be expected to maintain, rather than drive down, smoking prevalence. We examined the association between smoking prevalence and duty over a 10-year period. Methods: Using monthly data from five Australian capital cities, collected from March 2001 to March 2010 among Australians aged at least 18 years, multiple linear regression modeled associations between smoking prevalence and the two components (duty and non-duty) of the recommended retail price of an average packet of cigarettes, adjusting for policy covariates. Results: Prevalence declined from 23.6% in March 2001 to 17.0% in March 2010 [absolute difference 6.6%; 95% confidence interval (CI) = 6.5 to 6.8]. Duty increased from $0.2026 to $0.2622 per cigarette over the same period. In the adjusted model, a 1-cent increase in the duty component of price was not associated with changes in prevalence (0.019; 95% CI = −0.035 to 0.028). Increased non-duty component of price was associated with a decline in prevalence (−0.027; 95% CI = −0.052 to −0.002).This effect was stronger when changes in income were controlled for. Conclusions: In line with expectations, inflation-adjusted duty was not associated with changes in smoking prevalence, but it may have prevented upward pressure on prevalence that increasing affordability could have exerted. Frequent increases in duty greater than the growth in both wages and goods would more effectively reduce smoking than regular indexation. Implications: Few countries inflation-adjusted excise duty to ensure that tobacco products do not become more affordable; however, Australia experienced a decade of inflation adjustment alone, enabling the impact of this policy to be studied.This study shows that inflation-adjusted duty likely did prevent tobacco becoming more affordable and that indexation was associated with declines in smoking when tobacco companies over-shifted the duty rises (ie, increased price over and above duty rises).The study also suggests that frequent increases in taxation that exceed both wage growth and increases in costliness of other goods are needed to prompt increased rates of quitting.
UR - http://www.scopus.com/inward/record.url?scp=85062065927&partnerID=8YFLogxK
U2 - 10.1093/ntr/nty213
DO - 10.1093/ntr/nty213
M3 - Article
C2 - 30304468
AN - SCOPUS:85062065927
SN - 1462-2203
VL - 21
SP - 293
EP - 299
JO - Nicotine and Tobacco Research
JF - Nicotine and Tobacco Research
IS - 3
ER -