A comprehensive economic assessment of the health effects of tobacco use and implications for tobacco control in Bangladesh.

BACKGROUND: Despite modest progress in reducing tobacco use, tobacco remains one of the major risk factors for non-communicable diseases in Bangladesh. METHODS: Using disease-specific, prevalence-based, cost-of-illness approach, this research estimated the economic costs of tobacco use and exposure to secondhand smoke based on data collected from a nationally representative survey of 10 119 households in 2018. RESULTS: The study estimated that 1.5 million adults were suffering from tobacco-attributable diseases and 61 000 children were suffering from diseases due to exposure to secondhand smoke in Bangladesh in 2018. Tobacco use caused 125 718 deaths in that year, accounting for 13.5% of all-cause deaths. The total economic cost was 305.6 billion Bangladeshi taka (BDT) (equivalent to 1.4% of gross domestic product or US$3.61 billion), including direct costs (private and public health expenditures) of BDT83.9 billion and indirect costs (productivity loss due to morbidity and premature mortality) of BDT221.7 billion. The total economic cost of tobacco more than doubled since 2004. CONCLUSION: Tobacco use imposes a significant and increasing disease and financial burden on society. The enormous tobacco-attributable healthcare costs and productivity loss underscore the need to strengthen the implementation of tobacco control policies to curb the epidemic.

The Impact of Income and Taxation in a Price-Tiered Cigarette Market: findings from the ITC Bangladesh Surveys.

BACKGROUND: Taxing tobacco is among the most effective measures of tobacco control. However, in a tiered market structure where multiple tiers of taxes coexist, the anticipated impact of tobacco taxes on consumption is complex. This paper investigates changing smoking behaviour in lieu of changing prices and changing income. The objective of the paper is to evaluate the effectiveness of change in prices (through taxes) and change in income in a price-tiered cigarette market. METHOD: A panel dataset from the International Tobacco Control Bangladesh surveys is used for analysis. For preliminary analysis transition matrices are developed. Next, probit and multinomial logit regression models are used to identify the effects of changes in prices and changes in income along with other control variables. FINDINGS: Transition matrices show significant movement of smokers across price tiers from one wave to another. Regression results show that higher income raises the probability to up-trade and decreases the probability to down-trade. Results also show that higher prices raises the probability to up-trade and reduces the probability to down-trade. Although not significant, there exists a negative relationship between the probability to down-trade and the probability to intend to quit. CONCLUSION: It is evident from the results that a price-tiered market provides smokers more opportunities to accommodate their smoking behaviour when faced with price and income change. Therefore, tiered structure of the tax system should be replaced with uniform taxes. Moreover, overall cigarette taxes need to be raised to an extent so that it off-sets any positive effects of income growth.

The price sensitivity of cigarette consumption in Bangladesh: evidence from the International Tobacco Control (ITC) Bangladesh Wave 1 (2009) and Wave 2 (2010) Surveys.

BACKGROUND: In Bangladesh, the average excise tax on cigarettes accounted for just 38% of the average retail price of cigarettes in 2009, and 45% in 2010. Both these rates are well below the WHO recommended share of 70% of the retail price at a minimum. There is thus ample room for raising taxes on cigarettes in Bangladesh. The objective of the present work was therefore to estimate the price elasticity of demand for cigarettes and the effect of tax increases on the consumption of cigarettes and on tax revenue in Bangladesh. METHODS: Based on data from Wave 1 (2009) and Wave 2 (2010) of the International Tobacco Control Bangladesh Survey, we estimated the overall impact of a price change on cigarette demand using a two-part model. The total price elasticity of cigarettes was measured by the sum of the elasticity of smoking prevalence and the elasticity of average daily consumption conditional on smoking participation. The price elasticity estimates were used in a simulation model to predict changes in cigarette consumption and tax revenue from tax and price increases. RESULTS: The total price elasticity of demand for cigarettes was estimated at -0.49. The elasticity of smoking prevalence accounted for 59% of the total price elasticity. The price elasticity of cigarette consumption is higher for people belonging to lower socioeconomic status. Increases in taxes would result in a significant reduction in cigarette consumption while increasing tax revenue. CONCLUSIONS: Raising cigarette prices through increased taxation could lead to a win-win-win situation in Bangladesh: it would reduce cigarette consumption, increase tobacco tax revenue and potentially decrease socioeconomic inequities.