From: The World Bank
Submitted by Sheila Dutta
Illicit trade in tobacco products undermines global tobacco prevention and control interventions, particularly with respect to tobacco tax policy. From a public health perspective, illicit trade weakens the effect of tobacco excise taxes on tobacco consumption – and consequently on preventable morbidity and mortality – by increasing the affordability, attractiveness, and/or availability of tobacco products. Furthermore, tobacco illicit trade often depends on and can contribute to weakened governance.
Contrary to tobacco industry arguments, raising tobacco taxes is not the primary cause of illicit trade. Accumulated evidence indicates that the illicit cigarette market is relatively larger in countries with low taxes and prices, while relatively smaller in countries with higher cigarette taxes and prices. Non-price factors such as governance status, weak regulatory framework, and the availability of informal distribution networks appear to be far more important factors.
A new report, Confronting Tobacco Illicit Trade: A Global Review of Country Experiences, prepared in collaboration with a multisectoral team across different institutions shows that reducing illicit trade in tobacco products is critical from the perspective of public health, public finance, governance, or equity.
