Estimating the impacts of cigarette taxes on youth smoking participation,initiation, and persistence: empirical evidence from Canada

In response to the widespread availability of illegal contraband, the federal and five provincial governments in Canada implemented a 40–60% reduction to cigarette excise taxes in February 1994. We exploit this unique and discrete policy shock by estimating the effects of cigarette taxes on youth smoking with data from the 1992–1996 Waterloo Smoking Prevention Program, 1991 General Social Survey, 1994 Youth Smoking Survey, 1996–1997 and 1998–1999 National population Health Surveys, and the 1999 Canadian Tobacco Use Monitoring Survey. Empirical estimates yield daily and occasional participation elasticities from ?0.10 to ?0.14, which is consistent with findings from recent U.S.‐based research. A key contribution of this research is in the analysis of lower taxes on a panel of 591 youths from the Waterloo Smoking Prevention Program, who did not smoke in 1993, but 43% of whom confirm smoking participation following the tax reduction. Employing these data reveals elasticities from ?0.2 to ?0.5, which suggest that even significant and discrete changes in taxes might have limited impacts on the initiation and persistence of youth smoking. Copyright © 2009 John Wiley & Sons, Ltd.     

State cigarette excise taxes - United States, 2010-2011

Increasing the price of cigarettes reduces the demand for cigarettes, thereby reducing youth smoking initiation and cigarette consumption and decreasing the prevalence of cigarette use in the United States overall, particularly among youths and young adults. The most common way governments have increased the price of cigarettes is by increasing cigarette excise taxes, which currently are imposed by all states and the District of Columbia. To update data on state cigarette excise taxes in 2009, CDC conducted a survey of changes in state cigarette excise taxes during 2010-2011. During that period, eight states increased their cigarette excise taxes, and one state decreased its tax; as a result, the mean state tax increased from $1.34 in 2009 to $1.46 in 2011. Previous evidence indicates that further increases in cigarette excise taxes would be expected to result in further reductions in demand for cigarettes, decreasing smoking and associated morbidity and mortality.     

The importance of peer effects, cigarette prices and tobacco control policies for youth smoking behavior

This paper expands the youth cigarette demand literature by undertaking an examination of the determinants of smoking among high school students incorporating the importance of peer effects and allowing cigarette prices (taxes) and tobacco control policies to have a direct effect and an indirect effect (via the peer effect) on smoking behavior. To control for the potential endogeneity of our school-based peer measure we implement a two-stage generalized least squares estimator for a dichotomous dependent variable and implement a series of diagnostic tests. The key finding is that peer effects play a significant role in youth smoking decisions: moving a high-school student from a school where no children smoke to a school where one quarter of the youths smoke is found to increase the probability that the youth smokes by about 14.5 percentage points. The results suggest that there is a potential for social multiplier effects with respect to any exogenous change in cigarette taxes or tobacco control policies.     

Higher cigarette taxes--healthier people, wealthier state: the Hungarian experience

OBJECTIVE: To prove that higher cigarette taxes eventually decrease smoking and do also increase state incomes from tobacco taxes by using Hungarian figures. METHOD: Collection and analysis of available data on tobacco use, levels of excise and value added taxes on tobacco products and state incomes originating from the tobacco sector. CONCLUSIONS: In Hungary, regular tobacco tax increases resulted in decreased cigarette consumption and its lower prevalence figures in some population groups. State incomes have increased in spite of regular cigarette tax raises. Therefore, there is on conflict of interest between the health and finance portfolios in supporting further tobacco tax increases. Hungary should use regular, above the inflation tobacco tax raises as means for improving population health. Tobacco control advocates should prevent tobacco companies' attempts aimed at deterring decision makers from supporting such tax policies.     

Can government policies help adolescents avoid risky behavior?

BACKGROUND: This study examines the extent to which policies influence participation of adolescents in alcohol and tobacco consumption and in unsafe sex. METHODS: Data were obtained from the 1995 Youth Risk Behavior Surveys (YRBS) conducted by 20 different states and cities in the U.S. These data were combined with state data on cigarette taxes, vending machine laws, beer taxes, and family planning clinic availability. A model of teenage risk taking suggested that the three risk behaviors were codetermined by a common latent risk-taking propensity. We used a structural equation model (SEM) accounting for this shared latent propensity to estimate the extent of participation in terms of frequency of smoking, drinking, and the number of sex partners. RESULTS: Estimating simultaneous equations for all three risk behaviors was statistically more efficient than equation-by-equation estimates of each behavior. Estimates indicated significant deterrent effects of beer taxes, vending machine restrictions, and increased density of family planning clinics on teenage risk behavior. CONCLUSIONS: State policies, such as taxes on beer, and restrictions on location of cigarette vending machines, and placement of family planning clinics influence adolescents' behavior. Because there is interrelationship between these behaviors, systems estimators, can offer improved estimates of these effects.     

State tobacco excise taxes and adolescent smoking behaviors in the United States.

The objective of the study described in this article was to examine the association between state cigarette excise taxes and smoking behaviors among youth in the United States. A survey was nationally mailed to adolescents in the Growing Up Today Study, an ongoing cohort of offspring of participants in the Nurses' Health Study II. A volunteer sample of 10,981 adolescent boy and girl participated in the Growing Up Today Study, who were 12 to 18 years old in 1999. Logistic regression was used to examine the relationship between state cigarette excise taxes (in quartiles) and experimentation (ever smoked) and established smoking (smoked at least 100 cigarettes in a lifetime). State tax levels in 1999 ranged from 2.5 to 100 cents. In a model that adjusted for age, gender, peer smoking, parental smoking, state clustering, state poverty level, and possession of tobacco promotional items, higher tax rates were associated with decreased odds of experimentation (test for trend p < 0.01). The highest quartile of tax (60-100 cents) was significantly associated with lower odds of experimentation (OR = 0.79; 95% CI, 0.64-0.98) and appeared protective against established smoking (OR = 0.80; 95% CI, 0.49-1.29). This study provides recent evidence that higher state cigarette excise taxes are associated with decreased experimental smoking among adolescent boys and girls. Higher state cigarette taxes may also be associated with lower odds of established smoking in this age group, although the association appears to be attenuated by peer and parental smoking. These results support the inclusion of tobacco taxes in state tobacco control programs.     

Intended and unintended effects of e-cigarette taxes on youth tobacco use

Over the past decade, rising youth use of e-cigarettes and other electronic nicotine delivery systems (ENDS) has contributed to aggressive regulation by state and local governments. Between 2010 and mid-2019, ten states and two large counties adopted ENDS taxes. We use two large national surveys (Monitoring the Future and the Youth Risk Behavior Surveillance System) to estimate the impact of ENDS taxes on youth tobacco use. We find that ENDS taxes reduce youth ENDS consumption, with estimated ENDS tax elasticities of -0.06 to -0.21. However, we estimate sizable positive cigarette cross-tax effects, suggesting economic substitution between cigarettes and ENDS for youth. These substitution effects are particularly large for frequent cigarette smoking. We conclude that the unintended effects of ENDS taxation may considerably undercut or even outweigh any public health gains.     

Cigarette taxes and the transition from youth to adult smoking: smoking initiation, cessation, and participation

Many policy makers continue to advocate and adopt cigarette taxes as a public health measure. Most previous individual-level empirical studies of cigarette demand are essentially static analyses of the relationship between the level of taxes and smoking behavior at a point in time. In this study, we use longitudinal data to examine the dynamics of young adults' decisions about smoking initiation and cessation. We develop a simple model to highlight the distinctions between smoking initiation, cessation, and participation. We show that because smoking participation reflects past decisions regarding initiation and cessation, the price elasticity of smoking participation is a weighted average of corresponding initiation and cessation elasticities, a finding that applies more broadly to other addictive substances as well. The paper's remaining contributions are empirical. We use data from the 1992 wave of the National Education Longitudinal Study, when most of the cohort were high school seniors, and data from the 2000 wave, when they were about 26 years old. The results show that the distinction between initiation and cessation is empirically useful. We also contribute new estimates on the tax-responsiveness of young adult smoking, paying careful attention to the possibility of bias if hard-to-observe differences in anti-smoking sentiment are correlated with state cigarette taxes. We find no evidence that higher taxes prevent smoking initiation, but some evidence that higher taxes are associated with increased cessation.     

Smoking initiation among youth: the role of cigarette excise taxes and prices by race/ethnicity and gender

Existing evidence for the role of cigarette excise taxes and prices as significant determinants of youth smoking initiation is mixed. A few studies have considered the possibility that the impact of cigarette taxes and prices might differ by gender or race/ethnicity. In this paper, we address the role of cigarette taxes and prices on youth smoking initiation using the National Longitudinal Survey of Youth 1997 cohort and discrete-time survival methods. We present results overall and by gender, race/ethnicity, and gender by race/ethnicity. We examine initiation over the age range during which youth are most at risk of initiation and over a period in which substantial changes have occurred in tax and price. The result for cigarette excise taxes is small and mixed across alternative specifications, with the effect strongest for black youth. Cigarette prices are more consistently a significant determinant of youth smoking initiation, especially for black youth.     

Economic and Political Influence on Tobacco Tax Rates: A Nationwide Analysis of 31 Years of State Data

Objectives. We evaluated state-level characteristics associated with cigarette excise taxes before and after the Master Settlement Agreement (MSA).Methods. We gathered annual cigarette excise tax rates for all US states and the District of Columbia, between 1981 and 2011, and matched each state–year tax rate with economic, political, attitudinal, and demographic characteristics, creating a data set of 1581 observations. We used panel data regression techniques to assess relationships between key characteristics and state cigarette excise tax levels.Results. Cigarette excise tax rates grew at more than 6 times the rate of inflation between 1981 and 2011; growth varied by time period and region. We found strong negative associations between Republican Party control of state legislatures and governors’ offices and state cigarette tax rates. Tobacco production, citizens’ attitudes toward taxes and tobacco control, and cigarette tax rates in neighboring states were significantly associated with cigarette tax rates. We found no association between unemployment and tax rates.Conclusions. Future excise tax growth rate may depend more on the political leanings of state legislators, and the attitudes of the people they represent, than on economic circumstances.Smoking prevalence has declined in the past few decades, but recently, progress has stalled.1,2 In 1997, nearly 1 in 4 adults, and more than 1 in 3 youths, smoked at least 1 cigarette in the previous month. Although by 2007 rates for both groups had dropped to about 20%, no declines have been observed since.2,3 Without further progress, Healthy People 2020 goals for smoking among adults (12%) and youths (16%) will not be met.4Cigarette excise taxes are considered one of the most effective strategies for reducing smoking.5,6 Higher cigarette prices are associated with decreased consumption,7–9 and taxes are an effective tool for raising product price.10 Furthermore, in almost half of all states, some portion of excise tax revenues fund tobacco control programs.11Although all states levy cigarette taxes, rates vary extensively.12 In 2011, New York’s $4.35 tax rate was more than 25 times higher than Missouri’s $0.17 rate.13 Geographic variation in taxes may promote regional disparities in smoking prevalence and encourage cross-border smuggling or online tobacco sales, limiting the public health impact and revenue generation capabilities of high taxes.13–15 In 2007, the Institute of Medicine recommended that states with excise taxes below those in the top quintile raise their rates to match those in high-tax states.6Yet raising cigarette taxes, especially in low-tax states, has proven difficult. Between 2007 and 2011, only 43% of states in the bottom 4 quintiles raised taxes, whereas 91% of the highest-tax states increased their rates.12 Little is known about what motivates recent changes in state excise tax levels. Tobacco control advocates have suggested that economic contractions may drive states to raise cigarette taxes to generate revenue, noting high numbers of tax hikes following national recessions.16Political scientists, however, argue that political factors and regional pressures may also be important policy predictors.17–19 Nonelection years and neighboring tax initiatives, in addition to poor fiscal health, have been associated with diffusion of gasoline and income taxes.18 Public support of tobacco control, as well as actions of local and neighboring governments, influence the uptake of indoor air and tobacco sales restriction policies.20,21 The extent to which economic circumstances, state politics, constituency beliefs, or regional pressures influence state cigarette excise tax rates, however, remains unclear.Moreover, the key determinants of cigarette taxes can change over time, as public opinion evolves. The 1998 Master Settlement Agreement (MSA) with tobacco manufacturers generated new allocations of tobacco control revenue, some of which was used to fund social marketing campaigns about smoking and the tobacco industry (e.g., the “truth” campaign). One study did document some economic and political correlates of state cigarette tax rates, but relied on data through 2000, just as the impact of the MSA began.22 In the years since the MSA, the public has increasingly identified smoking as hazardous, and the majority now supports some form of tobacco control legislation.23 If these public sentiments influence beliefs about cigarette taxes, the political landscape in which tax decisions are made could be changing.Better understanding of which factors most strongly predict cigarette taxes could help tobacco control professionals target their advocacy. We used annual data from all 50 states between 1981 and 2011 to explore the magnitude of the associations between key economic, political, and regional characteristics and state cigarette excise tax levels, both before and after the MSA.     

The effects of mandatory seatbelt laws on seatbelt use, motor vehicle fatalities, and crash-related injuries among youths

We provide the first comprehensive assessment of the effects of mandatory seatbelt laws on self-reported seatbelt use, highway fatalities, and crash-related injuries among high school age youths using data from the Centers for Disease Control's (CDC) national, state, and local Youth Risk Behavior Surveys (YRBS) and the Fatality Analysis Reporting System (FARS) from 1991 to 2005, a period spanning over 20 changes in state seatbelt laws. Our quasi-experimental approaches isolate the independent effects of seatbelt laws net of demographic characteristics, area and year fixed effects, and smooth area-specific trends. Across all data sources, we find consistent evidence that state mandatory seatbelt laws - particularly those permitting primary enforcement - significantly increased seatbelt use among high school age youths by 45-80%, primarily at the extensive margin. Unlike previous research for adults, however, we find evidence against the selective recruitment hypothesis: seatbelt laws had consistently larger effects on those most likely to be involved in traffic accidents (drinkers, alcohol-involved drivers). We also find that mandatory seatbelt laws significantly reduced traffic fatalities and serious injuries resulting from fatal crashes by 8 and 9%, respectively. Our results suggest that if all states had primary enforcement seatbelt laws then regular youth seatbelt use would be nearly universal and youth fatalities would fall by about 120 per year.     

Tobacco Policies in Louisiana: Recommendations for Future Tobacco Control Investment from SimSmoke,a Policy Simulation Model

Despite the presence of tobacco control policies, Louisiana continues to experience a high smoking burden and elevated smoking-attributable deaths. The SimSmoke model provides projections of these health outcomes in the face of existing and expanded (simulated) tobacco control polices. The SimSmoke model utilizes population data, smoking rates, and various tobacco control policy measures from Louisiana to predict smoking prevalence and smoking-attributable deaths. The model begins in 1993 and estimates are projected through 2054. The model is validated against existing Louisiana smoking prevalence data. The most powerful individual policy measure for reducing smoking prevalence is cigarette excise tax. However, a comprehensive cessation treatment policy is predicted to save the most lives. A combination of tobacco control policies provides the greatest reduction in smoking prevalence and smoking-attributable deaths. The existing Louisiana excise tax ranks as one of the lowest in the country and the legislature is against further increases. Alternative policy measures aimed at lowering prevalence and attributable deaths are: cessation treatments, comprehensive smoke-free policies, and limiting youth access. These three policies have a substantial effect on smoking prevalence and attributable deaths and are likely to encounter more favor in the Louisiana legislature than increasing the state excise tax.     

The effect of cigarette taxes on cigarette consumption, 1955 through 1994.

OBJECTIVES: This study examines the effectiveness of state and federal taxes in reducing the consumption of cigarettes, estimates the impact of government health warnings, and shows how warnings and taxes interact. METHODS: By means of a pooled time-series analysis from 1955 through 1994 with the 50 states as units of analysis, the impact of excise taxes on cigarette consumption for several different models and econometric techniques is assessed. RESULTS: From 1955 through 1994, increases in state taxes were effective in reducing cigarette use. Federal tax increases, however, appear to have been more effective. This difference is partly the result of the "bootlegging" of cigarettes across state lines and the size of the increases in the federal tax. Cigarette consumption also declined when health warning labels were added. CONCLUSIONS: Increases of taxes on cigarettes are associated with declines in the consumption of tobacco. Because of inflation, increased health concerns, and the declining percentage of smokers, however, large reductions in consumption require large tax increases.     

The role of public policies in reducing smoking prevalence in California: results from the California tobacco policy simulation model

Tobacco control policies are examined utilizing a simulation model for California, the state with the longest running comprehensive program. We assess the impact of the California Tobacco Control Program (CTCP) and surrounding price changes on smoking prevalence and smoking-attributable deaths. Modeling begins in 1988 and progresses chronologically to 2004, and considers four types of policies (taxes, mass media, clean air laws, and youth access policies) independently and as a package. The model is validated against existing smoking prevalence estimates. The difference in trends between predicted smoking rates from the model and other commonly used estimates of smoking prevalence for the overall period were generally small. The model also predicted some important changes in trend, which occurred with changes in policy. The California SimSmoke model estimates that tobacco control policies reduced smoking rates in California by an additional 25% relative to the level that they would have been if policies were kept at their 1988 level. By 2004, the model attributes 59% of the reduction to price increases, 28% of the overall effect to media policies, 11% to clean air laws, and only a small percent to youth access policies. The model estimates that over 5000 lives will be saved in the year 2010 alone as a result of the CTCP and industry-initiated price increases, and that over 50,000 lives were saved over the period 1988-2010. Tobacco control policies implemented as comprehensive tobacco control strategies have significantly impacted smoking rates. Further tax increases should lead to additional lives saved, and additional policies may result in further impacts on smoking rates, and consequently on smoking-attributable health outcomes in the population.     

Tobacco use among middle and high school students--United States, 2002

Each day in the United States, approximately 4,400 youths aged 12-17 years try their first cigarette. An estimated one third of these young smokers are expected to die from a smoking-related disease. The National Youth Tobacco Survey (NYTS), conducted by the American Legacy Foundation, provides estimates of usage among U.S. middle and high school students for various tobacco products (i.e., cigarettes, cigars, smokeless tobacco, pipes, bidis [leaf-wrapped, flavored cigarettes from India], and kreteks [clove cigarettes]). This report summarizes tobacco use prevalence estimates from the 2002 NYTS and describes changes in prevalence since 2000. Both tobacco use and cigarette smoking among students in high school (i.e., grades 9-12) decreased by approximately 18% during 2000-2002; however, a decrease among students in middle school (i.e., grades 6-8) was not statistically significant. The lack of progress among middle school students suggests that health officials should improve implementation of proven antismoking strategies and develop new strategies to promote continued declines in youth smoking.     

Cigarette Taxes,Smoking—and Exercise?

This research provides the first in‐depth analysis of the effect that increased cigarette taxes have on exercise behavior. Smoking may diminish the ability to exercise; individuals may also use exercise to compensate for the harmful health effects of smoking or to avoid gaining weight if they cut back. Our conceptual model highlights these and several other avenues for effect and reveals that the predicted effect of cigarette costs on exercise behavior is theoretically ambiguous. To investigate the relationship empirically, 1994–2012 data from the behavioral risk factor surveillance system are combined with state level cigarette tax rates and other state level variables. Several measures of both smoking and exercise behavior are created and estimated in reduced form models. Our results suggest that both smoking and exercise are reduced by cigarette taxes. However, the effects on exercise may be more complicated as we find that certain groups, such as young adults or those who have recently quit smoking, are affected differently. Our analyses also show that the responsiveness of both smoking and exercise behavior to cigarette costs is much smaller in the 2000s, an era of high‐tax increases. Copyright © 2016 John Wiley & Sons, Ltd.     

State-level tobacco control policies and youth smoking cessation measures

ObjectiveResearch on the effects of state-level tobacco control policies targeted at youth has been mixed, with little on the effects of these policies and youth smoking cessation. This study explored the association between state-level tobacco control policies and youth smoking cessation behaviors from 1991 to 2006.MethodsThe study design was a population-based, nested survey of students within states. Study participants were 8th, 10th, and 12th graders who reported smoking “regularly in the past” or “regularly now” from the Monitoring the Future study. Main cessation outcome measures were: any quit attempt; want to quit; non-continuation of smoking; and discontinuation of smoking.ResultsResults showed that cigarette price was positively associated with a majority of cessation-related measures among high school smokers. Strength of sales to minors’ laws was also associated with adolescent non-continuation of smoking among 10th and 12th graders.ConclusionsFindings suggest that increasing cigarette price can encourage cessation-related behaviors among high school smokers. Evidence-based policy, such as tax increases on tobacco products, should be included as an important part of comprehensive tobacco control policy, which can have a positive effect on decreasing smoking prevalence and increasing smoking cessation among youth.     

The effect of cigarette taxes on smoking among men and women

The literature contains numerous studies that estimate the effect of cigarette taxes on smoking across various population groups. Although the conclusions are split, most US studies find that men are more responsive to cigarette taxes than women. This paper shows that these results are due to the failure to control for state-specific gender gaps in smoking rates that are correlated with cigarette taxes. When gender-specific state fixed effects are included to control for these gaps, the results indicate that women are nearly twice as responsive to cigarette taxes as are men. Since the econometric specification controls for variation in the tax response by household income, it is unlikely to be responsible for the difference.     

Mexico SimSmoke: how changes in tobacco control policies would impact smoking prevalence and smoking attributable deaths in Mexico

We examined the effect of tobacco control policies in Mexico on smoking prevalence and smoking-related deaths using the Mexico SimSmoke model. The model is based on the previously developed SimSmoke simulation model of tobacco control policy, and uses population size, smoking rates and tobacco control policy data for Mexico. It assesses, individually, and in combination, the effect of six tobacco control policies on smoking prevalence and smoking-related deaths. Policies included: cigarette excise taxes, smoke-free laws, anti-smoking public education campaigns, marketing restrictions, access to tobacco cessation treatments and enforcement against tobacco sales youth. The model estimates that, if Mexico were to adopt strong tobacco control policies compared to current policy levels, smoking prevalence could be reduced by 30% in the next decade and by 50% by 2053; an additional 470,000 smoking-related premature deaths could be averted over the next 40 years. The greatest impact on smoking and smoking-related deaths would be achieved by raising excise taxes on cigarettes from 55% to at least 70% of the retail price, followed by strong youth access enforcement and access to cessation treatments. Implementing tobacco control policies in Mexico could reduce smoking prevalence by 50%, and prevent 470,000 smoking-related deaths by 2053.     

Cigarette taxes and older adult smoking: evidence from recent large tax increases

While recent evidence casts some doubt, it is generally accepted that the price sensitivity of smoking varies inversely with age. We investigate the responsiveness of older adult smoking using variation from recent historically large cigarette tax increases in the United States. Using data from the Behavioral Risk Factor Surveillance System from 2000 to 2005, we find consistent evidence that higher taxes reduced smoking participation by older adults, especially those who are less educated and live in low-income households. Our findings run contrary to existing evidence which suggests that cessation behavior by older adults is not sensitive to price. Since a large literature suggests smoking cessation even later in life reduces morbidity and increases longevity, our findings may represent substantial gains in health among tax-induced quitters.