Higher cigarette taxes may not benefit anti-smoking drive: Study

Increasing cigarette taxes may have the unintended consequence of driving consumers to higher nicotine content and more dangerous cigarette products, says a new study co-authored by an Indian-origin researcher.

Given the addictive properties of nicotine, increasing cigarette taxes per package increases addiction levels for some consumers, the findings showed.

"While taxes are the most effective technique for reducing smoking rates, we find that this tool has a significant downside," said one of the researchers Vishal Singh from New York University.

"Because cigarette taxes are currently applied at the per pack level and without regard to nicotine levels, consumers may respond to increasing cigarette taxes by switching to higher nicotine products," Singh pointed out.

"In other words, if consumers desire to minimise the cost per unit of nicotine, then increasing cigarette taxes may lead some consumers to shift to higher nicotine products," he explained.

Over the past 50 years, regulators and advocacy groups have increasingly used counter-marketing tools to discourage cigarette consumption.

Excise taxes are used to increase prices faced by consumers. Educational advertising is used to increase awareness of health risks and decrease preferences for the category. Smoke-free policies are used to make cigarette consumption less convenient.

For the study, the researchers conducted analysis on nationwide data about store sales and examined populations of consumers that are exposed to different tax rates, advertising levels, and smoking prohibitions.

In addition, data from the US Census allowed the researchers to examine the effectiveness of counter-marketing across consumers of different socio-economic levels.

The researchers found that the different anti-smoking techniques varied in terms of effectiveness.

Importantly, the authors found that this unintended consequence of cigarette taxes was more likely to occur in poorer neighbourhoods. The study was published in the journal Marketing Science.