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| Page 1
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
| Page 2
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
1. Smoking prevalence
The rate of smoking tends to increase with development reflecting higher prevalence of cigarette
use among women as incomes increase.
The rate of smoking is relatively high across Eurasia especially among adult males, adult females in
Russia and the Ukraine, and young females in Belarus.
There are currently 66 million adult smokers and 735,000 youth smokers across Eurasia.
More than 8 million of Eurasia’s current youth population could take up smoking by 2020.
2. Tobacco attributable mortality
Smoking is currently responsible for 500,000 deaths per year across Eurasia, representing 16% of all
adult deaths in the region compared to 12% of all adult deaths globally.
Smoking attributable mortality is disproportionately high among Eurasian males at 28% of all male
deaths compared to 16% of all male deaths globally.
In the absence of further intervention, some 25 million people in the current population of Eurasia
will die early from diseases caused by continued smoking.
3. The economic cost of tobacco attributable diseases
The proportion of health care costs attributable to smoking ranges between 6-15% in high income
countries representing an otherwise preventable drain on public health resources.
Eurasian loses 295,000 workers per year due to early mortality from smoking attributable diseases.
The output loss for Eurasia due to early mortality from smoking is estimated at 200 billion of GDP in
Purchasing Power Parity (PPP) terms, or as much as 6.5% of annual GDP for the region.
4. The impact of tobacco control measures
The MPOWER measures for tobacco control are highly effective and such policies implemented by
countries since 2007 are expected to prevent 7.4 million early deaths globally by 2050.
Turkey is the first country to reach the highest level of achievement in all six MPOWER measures
and has recorded a 13% relative decrease in smoking prevalence in five years.
Another sixteen countries have fully implemented at least three MPOWER measures and per capita
cigarette consumption in these countries has collectively fallen by 20% over 2007-2012.
5. The health impact of tobacco taxation
The impact of higher tobacco taxes on public health is assessed in relation to the three Customs
Union of Belarus, Kazakhstan and Russia.
If the Customs Union countries raise excise to the equivalent of 90 euro per 1000 by 2020, then the
price of cigarettes would increase from less than 1.1 euro/pack today to 3.5 euro/pack in 2020.
These higher cigarette prices would ultimately reduce the prevalence rate of smoking in these three
countries from 37% today to 26% after 2020.
Some 19 million smokers would quit smoking in response to higher prices including 3 million young
people who would otherwise take up smoking.
More than 4 million early deaths due to continued smoking would be averted in the future.
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TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Rate of smoking in adult males, 2011 Rate of smoking in adult females, 2011
Number of adult smokers, 2011
Population (000s)
Prevalence rate (current smoker)
Number of smokers (000s)
Male Female Both Male Female Both Male Female Both
Belarus 3,776 4,652 8,429 51% 10% 28% 1,930 456 2,386 Kazakhstan 5,751 6,602 12,353 40% 9% 23% 2,314 566 2,881 Moldova 1,405 1,631 3,036 43% 5% 23% 605 85 690 Russia 55,882 69,366 125,249 60% 22% 39% 33,641 15,053 48,694 Ukraine 17,851 22,405 40,256 50% 11% 28% 8,926 2,532 11,457
Eurasia 84,666 104,657 189,323 56% 10% 35% 47,415 18,692 66,107 World 2,554,168 2,630,769 5,184,937 33% 7% 20% 845,688 185,489 1,031,176
Source: TCE calculations using population data from UN (2013) and prevalence data from WHO (2011).
Source: TCE calculations. Source: TCE calculations.
0% 10% 20% 30% 40% 50% 60%
Ukraine
Russia
Moldova
Kazakhstan
Belarus
World
High Income
Upper Middle
Lower Middle
Low Income
% of adult male population
0% 10% 20% 30% 40% 50% 60%
Ukraine
Russia
Moldova
Kazakhstan
Belarus
World
High Income
Upper Middle
Lower Middle
Low Income
% of adult female population
1. Smoking prevalence
The rate of smoking tends to increase with development reflecting higher prevalence of cigarette
use among women as incomes increase.1
The rate of smoking is relatively high across Eurasia especially among adult males, adult females in
Russia and the Ukraine, and young females in Belarus.
There are currently 66 million adult smokers and 735,000 youth smokers across Eurasia.
More than 8 million of Eurasia’s current youth population could take up smoking by 2020.
1The World Bank categorizes Moldova and the Ukraine as Lower Middle Income Countries, and Belarus, Kazakhstan and
Russia as Upper Middle Income Countries.
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TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Combined rate of adult smoking, 2011
Number of youth smokers, 2011
13-15 population (000s)
Prevalence rate (current smoking)
Number of youth smokers (000s)
Male Female Both Male Female Both Male Female Both
Belarus 97 92 189 32% 22% 27% 31 20 51 Kazakhstan 223 213 435 12% 8% 10% 27 17 44 Moldova 41 40 82 21% 7% 14% 9 3 11 Russia 1,306 1,252 2,558 19% 15% 17% 251 192 442 Ukraine 433 412 844 31% 13% 22% 133 53 186
Eurasia 2,100 2,008 4,108 21% 14% 18% 450 284 735
Source: TCE calculations using population data from UN (2013) and prevalence data from WHO (2013).
Today’s youth as smokers in 2020
Source: TCE calculations using data from UN (2013) and WHO (2013).
Source: TCE calculations.
0% 10% 20% 30% 40% 50%
Ukraine
Russia
Moldova
Kazakhstan
Belarus
World
High Income
Upper Middle
Lower Middle
Low Income
% of combined adult population
5-14 age population
Adult Smoking
Potential new smokers in 2020
(000s, 5-14) (%) (000s, 5-14) Belarus 1,017 28% 288 Kazakhstan 2,624 23% 612 Moldova 407 23% 92 Russia 15,175 39% 5,900 Ukraine 4,487 28% 1,277
Eurasia 23,710 35% 8,169
The rate of smoking tends to increase
with development reflecting higher
prevalence of cigarette use among
women as incomes increase.
A major public health risk is that more
women in low and middle income
countries will take up smoking as
incomes increase over time.
Cigarette use among adult women is
still relatively low in Belarus and
Kazakhstan compared to other upper
middle income countries.
A second public health risk is that when
today’s youth become adults, they will take
up smoking at a similar rate to their parents.
Thus, more than 8 million of Eurasia’s youth
population could take up smoking by 2020.
| Page 5
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Death rate due to tobacco, 2004 Share of deaths due to tobacco, 2004
Source: TCE calculations. Source: TCE calculations.
0 100 200 300 400 500 600
Ukraine
Russia
Moldova
Kazakhstan
Belarus
World
High Income
Upper Middle
Lower Middle
Low Income
Tobacco deaths per 100,000
0% 5% 10% 15% 20% 25%
Ukraine
Russia
Moldova
Kazakhstan
Belarus
World
High Income
Upper Middle
Lower Middle
Low Income
% of all adult deaths
Tobacco is the leading behavioral risk factor causing more than 5 million deaths each year globally.
Although many people associate smoking with non-communicable diseases such as cancers and heart
disease, it is also a major cause of death from communicable diseases such as TB (WHO, 2012).
Tobacco is responsible for a greater share of deaths in high income countries due to a range of factors
such as generally higher rates of cigarette smoking, the older-age profile of high income countries, as
well as the high mortality rate from communicable diseases in low income countries.
2. Tobacco attributable mortality
Globally, tobacco causes 7% of all deaths from TB, 10% of all deaths from cardiovascular diseases,
22% of all cancer deaths and 36% of all deaths from lower respiratory infections.
Smoking attributable mortality rates tend to be higher in middle and high income countries due to a
range of factors, primarily the relatively high prevalence rates of smoking.
Smoking is responsible for more than 500,000 deaths per year across Eurasia, representing 16% of
all adult deaths in the region compared to 12% of all deaths globally.
Smoking attributable mortality is disproportionately high among Eurasian males at 28% of all male
deaths compared to 16% of all male deaths globally.
| Page 6
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Adult mortality attributed to tobacco, 2004 Male
deaths Female deaths
Total deaths
Tobacco death rate
% male deaths
% female deaths
% of all deaths
(Number) (Number) (Number) (Rate) (% all) (% all) (% all) Belarus 20,090 281 20,371 344 28% 0% 15% Kazakhstan 30,692 9,334 40,026 555 35% 12% 24% Moldova 4,520 1,133 5,653 273 19% 5% 12% Russia 298,145 47,281 345,427 398 28% 4% 16% Ukraine 87,924 8,864 96,788 331 24% 2% 13%
Eurasia 441,371 66,893 508,264 394 28% 4% 16% World 3,573,921 1,529,456 5,103,377 174 16% 7% 12%
Source: TCE calculations using statistics from WHO (2012).
Death rate due to tobacco, 2004 Share of deaths due to tobacco, 2004
Source: WHO (2012) Source: WHO (2012)
0
200
400
600
800
1,000
Bel
arus
Ka
zakh
sta
n
Mo
ldo
va
Ru
ssia
Ukr
ain
e
Wo
rld
Tob
acc
o d
ea
ths
pe
r 1
00
,00
0
Males Females
0%
10%
20%
30%
40%
Bel
arus
Ka
zakh
sta
n
Mo
ldo
va
Ru
ssia
Ukr
ain
e
Wo
rld
% o
f d
eath
s at
trib
ute
d t
o t
ob
acco
Males Females
Smoking is responsible for over 500,000 deaths per year in Eurasia, representing 16% of all adult deaths
in the region. The Eurasia region accounts for 10% of all smoking-attributable deaths worldwide with
Russia alone accounting for 7% of all smoking-attributable deaths .
Smoking-attributable mortality is disproportionately high for Eurasian males, while Kazakhstan also
exhibits a high rate of smoking-attributable mortality in females.
| Page 7
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Share of all deaths by disease condition attributed to tobacco, 2004
Mortality rates from second-hand smoke, 2004
Source: WHO (2012)
22%
10%
36%
5%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Malignant neoplasms Cardiovascular
diseases
Respiratory diseases Communicable
diseases (e.g. TB)
% o
f d
eath
s at
trib
ute
d t
o t
ob
acco
Belarus Kazakhstan Moldova Russia Ukraine World
Source: TCE calculations using WHO (2009) and Oberg et al (2011).
0
10
20
30
40
50
US
Fran
ce
Jap
an
Ital
y
Ger
man
y
Ka
zah
sta
n
Ru
ssia
Mol
dova
Be
laru
s
Ukr
ain
e
SHS
deat
hs p
er 1
00,0
00
In addition to deaths from direct tobacco
use, it is estimated that second-hand
smoke (SHS) causes 600,000 deaths each
year globally (Oberg et al, 2011). Death
rates from SHS are higher in countries
where people are regularly exposed to
smoking at home and public places.
Surveys of youth in Moldova and the
Ukraine report that 57% of children are
exposed to SHS in public places. In 2004,
the situation was as even worse in Russia
with 89% of children reporting SHS
exposure (CDC, 2013).
| Page 8
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Public health spending due to smoking, 2012
Source: GHK (2009) estimates updated by TCE.
0 25 50 75 100 125 150
Germany
UnitedKingdom
France
Italy
Other EU
EU27
Euro per capita in 2012 prices
A recent study commissioned by the EC
found that public spending on diseases
caused by smoking in 27 EU countries
accounted for 6% of total public health
expenditures. This ranged from 4% in
Bulgaria to 12% in Hungary (GHK, 2009).
When the findings were updated by TCE to
reflect 2012 prices, public spending on
smoking attributable diseases in these 27
countries amounts to 53 billion euro or an
average of 110 euro per capita.
The term direct costs refer to the use of government and household resources to treat diseases
attributable to tobacco. In terms of fiscal impact, the proportion of health care expenditures attributable
to smoking in developed countries tends to range from 6-15% (World Bank, 1999).
The evidence suggests that direct costs are lower in low and middle income countries (WHO, 2011b).
This may be because the tobacco epidemic is at an earlier stage, or due to limited availability of medical
care in low and middle income countries (Ross et al, 2007).
3. The economic cost of tobacco attributable diseases
The proportion of health care costs attributable to smoking ranges from 6-15% in high income
countries representing an unnecessary and preventable drain on public health resources.
Smokers exhibit higher rates of absenteeism and can lose several months of work each year due to
more chronic conditions.
Eurasia loses 295,000 workers each year due to early mortality from smoking attributable diseases.
The output loss for Eurasia due to early mortality from smoking is estimated at 200 billion of GDP in
Purchasing Power Parity (PPP) prices, or as much as 6.5% of annual GDP for the region.
| Page 9
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Annual loss in workforce due to early mortality
Source: TCE calculations.
The term indirect cost refers to the loss in output and overall welfare of society from tobacco attributable
diseases. Some indirect costs such as the loss in output due to mortality and morbidity can be quantified
in monetary terms, while others such as pain and suffering often remain intangible.
Morbidity has a subtle effect on output with smokers registering excess rates of absenteeism in the order
of 2-3 days each year (Berman et al, 2013). However, absenteeism is not evenly distributed. The average
EU smoker suffering from cancer, COPD or cardiovascular disease losses 92, 122 and 136 workforce days
respectively to ill health (Suhrcke et al, 2008). Such rates of absenteeism surely impact on the earning
potential of those suffering from such chronic diseases.
Early mortality is responsible for the largest share of the indirect costs because it includes the permanent
reduction in the number of working-age persons (Guindon, 2007). This cost is commonly measured using
the Human Capital Approach which quantifies the net present value of all current and future years of
output lost for workers who die early from smoking.
TCE has used the Human Capital Approach to calculate the indirect cost of early mortality due to smoking
attributable diseases in Eurasia.
TCEs calculations first translate the annual
number of deaths from smoking into an
equivalent loss in the number of workers using
World Bank data on the employment-to-
population ratio for each country.
Thus, the Eurasian region is estimated to lose
295,000 workers each year due to early
mortality from smoking attributable diseases.
WHO Life Tables show that adults who die
early from smoking in Eurasia lose on average
17 years of life. This translates into a total of
4.8 million workforce years lost due to smoking
attributable deaths each year.
| Page 10
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Output loss due to early mortality, 2011 Tobacco
deaths Employment
ratio(1)
Workforce loss
Average years lost
Total years lost
GDP per
worker(2)
NPV of
output loss(3)
(Adults) (% 15+) (Workers) (Years) (Years) (GDP) (Million GDP)
Belarus 20,371 50.6% 10,308 15 156,124 34,008 8,441
Kazakhstan 40,026 67.7% 27,097 15 401,767 28,176 16,823 Moldova 5,653 38.7% 2,188 16 34,915 10,008 482 Russia 345,427 58.8% 203,111 17 3,480,839 33,220 160,183 Ukraine 96,788 54.5% 52,749 15 804,826 15,034 14,086
Eurasia 508,264 58.1% 295,493 17 4,878,472 29,233 200,015
(1) Source: World Bank (2013). (2) TCE estimates using country GDP for 2011 in Purchasing Power Parity (PPP) terms from the World Economic Outlook (IMF, 2012) divided by adult employment. Note the future value of GDP/worker is increased annually based on IMF forecasts of GDP/capita in PPP terms (IMF, 2012). (3) The output loss in future years converted into Net Present Value (NPV) terms using a 3% discount rate.
Output loss due to early mortality, % GDP
Source: TCE calculations.
TCEs calculations divide IMF data on country GDP in Purchasing Power Parity (PPP) terms for 2011 by
adult employment to arrive at the value of GDP/worker. Note the value of GDP/worker in future years is
calculated using IMF growth forecasts of GDP/capita in PPP terms.
The value of future workforce years lost is adjusted by a discount rate of 3% to arrive at the Net Present
Value (NPV) of all current and future output losses due to early mortality from smoking.
The loss in output due to smoking attributable
mortality in the Eurasian region per year is
estimated by TCE at 200 billion of GDP in
Purchasing Power Parity (PPP) terms for 2011.
The loss in output for Russia alone is estimated
at more than 160 billion GDP in PPP prices.
The loss in output for the Eurasia is equivalent
to as much as 6.5% of annual GDP for the
Eurasia region compared to 2% globally.
Kazakhstan shows the greatest relative loss at
7.8% of GDP followed by Russia at 6.7%.
| Page 11
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Impact of MPOWER, 2007-2010
Source: Levy et al (2013).
Smokers covered
Fewer smokers
Fewer deaths
(000s) (000s) (000s)
Protect air 85,445 5,033 2,516 Offer cessation 29,847 759 380 Warnings 100,633 1,340 681 Enforce bans 9,334 613 306 Raise taxes 62,416 7,056 3,528
Total 287,675 14,840 7,420
4. The impact of tobacco control measures
The WHO Framework Convention on Tobacco Control (FCTC) has been widely adopted with 177
Parties to the treaty including Belarus, Kazakhstan, Moldova, Russia and the Ukraine.
The MPOWER measures for tobacco control are highly effective and such policies implemented by
countries since 2007 are expected to prevent 7.4 million early deaths globally by 2050.
Turkey is the first country to reach the highest level of achievement in all six MPOWER measures
and has recorded a 13% relative decrease in smoking prevalence in five years.
Another sixteen countries have fully implemented at least three MPOWER measures and per capita
cigarette consumption in these countries has collectively fallen by 20% over 2007-2012.
.
The WHO Framework Convention on Tobacco
Control (FCTC) is the first international treaty
negotiated under the auspices of WHO. Parties to
the FCTC commit to protecting their population
by implementing demand reduction measures.
To help countries implement the treaty, WHO has
introduced MPOWER - a package of six technical
measures. Each measure relates to at least one
demand-side provision of the FCTC.
Monitor tobacco use and prevention policies.
Protect people from tobacco smoke.
Offer help to quit tobacco use.
Warn about the dangers of tobacco.
Enforce bans on tobacco advertising,
promotion and sponsorship.
Raise taxes on tobacco.
These measures are supported by substantial
evidence of their impact on smoking behavior
including experiences in low and middle income
countries (refer to WHO, 2008).
Research in the WHO Bulletin has assessed the
global impact of tobacco control in countries that
have fully implemented at least one MPOWER
measure over 2007-2010 (Levy et al, 2013). They
find these policies will result in 14.8 million fewer
smokers and avert 7.4 million deaths by 2050.
This research demonstrates the measureable
impact of actions already undertaken by many
countries and underscores the potential for
millions of additional lives to be saved with
continued adoption of MPOWER polices.
| Page 12
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Adult smoking rate in Turkey, 2008-2012
Source: WHO (2013).
Turkey is the first country to fully implement
all six MPOWER measures and has recorded
a 13% relative decline in smoking prevalence
in five years over 2008-2012 (WHO, 2013).
Another sixteen countries have fully
implemented at least three MPOWER
measures.2 Per capita cigarette consumption
in these countries has collectively fallen by
20% over 2007-2012 compared to a decline
of less than 1% in countries with lower levels
of implementation (Source: TCE).
2Australia, Brazil, Brunei, Canada, El Salvador, Iran,
Kuwait, Madagascar, Mauritius, NZ, Panama,
Seychelles, Spain, Thailand, the UK and Uruguay.
Newly published research has assessed the potential long-term effects of implementing MPOWER
policies in Russia (Maslennikova et al, 2013). This research used the SimSmoke model to assess the
impact of implementing seven tobacco control policies consistent with the WHO FCTC.
The SimSmoke model forecasts the impact of these seven polices on smoking prevalence and smoking
attributable deaths for Russia. These seven policies combined would decrease smoking prevalence by
37% in 2025 and by 49% in 2055. The impact of raising tobacco taxes alone is assessed by the SimSmoke
model to decrease prevalence by 13% in 2025 and by 23% in 2055.
The authors note that Russia has already begun to implement some policies (such as higher taxes, media
campaigns and health warnings). They estimate that these policies will have already reduced smoking
rates and will lead to the prevention of some 1.5 million smoking attributable deaths in the future.
| Page 13
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Number of early deaths in the future due to smoking
Population at risk (000s)
Number of early deaths(2) (000s)
Current smokers
Future smokers
(1)
Total smokers
Current smokers
Future smokers
Total smokers
Belarus 2,386 288 2,673 795 96 891 Kazakhstan 2,881 612 3,492 960 204 1,164 Moldova 690 92 782 230 31 261 Russia 48,694 5,900 54,593 16,231 1,967 18,198 Ukraine 11,457 1,277 12,735 3,819 426 4,245
Eurasia 66,107 8,169 74,276 22,036 2,723 24,759
(1) Calculated on the basis that today’s youth population will take-up smoking at the same rate as adults. (2) Conservatively assumes that 33% of cigarette smokers are risk of early death in the future from continued smoking.
Source: TCE calculations.
5. The health impact of tobacco taxation
Raising tobacco taxes has proven to be one of the most effective interventions for reducing tobacco
consumption, particularly among the young and the poor (WHO, 2011c).
In the absence of further interventions, some 25 million people in the current population of Eurasia
will die early from diseases caused by continued smoking.
The impact of higher tobacco taxes on public health is assessed in relation to the three Customs
Union of Belarus, Kazakhstan and Russia.
If the Customs Union countries raise excise to the equivalent of 90 euro per 1000 by 2020, then the
price of cigarettes would increase from less than 1.1 euro/pack today to 3.5 euro/pack in 2020.
These higher cigarette prices would ultimately reduce the prevalence rate of smoking in these three
countries from 37% today to 26% after 2020.
Some 19 million smokers would quit smoking in response to these higher prices including 3 million
young people who would otherwise take up smoking.
More than 4 million early deaths due to continued smoking would be averted in the future.
Studies have found that tobacco kills a third to a half of all people who use it (Peto, 1996) and that half
of all regular cigarette smokers will die early from tobacco attributable diseases (Doll, 2004, and DHHS,
2004). In the absence of further interventions to reduce the demand for cigarettes in Eurasia, TCEs
calculations conservatively show that 25 million people in the current population will die early from
diseases caused by smoking. This includes 3 million deaths from among the current youth population
who can be expected to take up smoking in the future.
| Page 14
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Cigarette tax simulations for the Customs Union
National currency terms Euro currency terms Excise per pack Price per pack FX rate Excise per pack Price per pack 2013 2020 2013 2020 % Real
(1) 2013 2013 2020 2013 2020
Belarus 2,196 21,798 7,076 37,912 223% 11,306 0.19 1.93 0.63 3.35 Kazakhstan 31 360 142 689 222% 198.9 0.16 1.81 0.72 3.46 Russia 15 102 44 190 203% 40.5 0.38 1.98 1.09 3.69
EU average 2.88 4.76
Source: TCE Tobacco Tax Simulations of excise rates that approximate 90 euro per 1000 sticks by 2020. (1) Percentage increase in cigarette prices after adjusting for inflation.
Average excise per cigarette pack Average price per cigarette pack
Source: TCE calculations Source: TCE calculations
0.0
1.0
2.0
3.0
4.0
5.0
Bel
arus
Kaz
akh
sta
n
Ru
ssia
EU a
vera
gein
201
2
(eu
ro p
er p
ack)
2013 2020
0.0
1.0
2.0
3.0
4.0
5.0
Bel
arus
Kaz
akh
sta
n
Ru
ssia
EU a
vera
gein
201
2
(eu
ro p
er p
ack)
2013 2020
TCE worked with Ministry of Finance officials from the three Customs Union countries to develop
Tobacco Tax Simulation (TaXSiM) models that quantify the impact of tobacco tax policies on excise
revenue and public health outcomes in their countries.
If the Customs Union countries raise excise to the equivalent of 90 euro per 1000 by 2020, then the
price of cigarettes in these three countries would increase by around 200% in inflation-adjusted terms
thus creating a sustained incentive for people to reduce cigarette consumption and quit smoking.
Cigarette prices in the Customs Union would increase from less than 1.1 euro/pack today to around 3.5
euro/pack by 2020. However, note these prices would still be lower than the current EU average of 4.76
euro/pack in 2012 (WHO,2013).
| Page 15
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
Health impact of reaching 90 euro/1000 by 2020
Adult prevalence rate of smoking (%)(1)
Reduction in number of smokers (000s)
Reduction in number of early deaths (000s)(2)
Current 2011
After 2020
% change
Current smokers
Future smokers
Total smokers
Current smokers
Future smokers
Total smokers
Belarus 28% 19% -33% 798 96 894 177 21 199 Kazakhstan 23% 16% -33% 959 204 1,162 213 45 258 Russia 39% 27% -30% 14,828 1,797 16,625 3,295 399 3,694
Union 37% 26% -31% 16,584 2,096 18,681 3,685 466 4,151
(1) The rate after 2020 is calculated using a prevalence elasticity of -0.15 on the real or inflation-adjusted price. (2) Calculated assuming a survival rate of 67% on average for regular adult smokers who quit smoking. Source: TCE WHO Tobacco Tax Simulations.
Predicted decrease in smoking rates
Source: TCE calculations and WHO (2013).
Global evidence suggests that half of the
impact of price on smoking comes from a
reduction in prevalence (IARC, 2011).
Consistent with this evidence and other
estimations, TCE calculations conservatively
assume a prevalence elasticity of -0.15 on the
inflation-adjusted change in cigarette prices.
Higher cigarette prices from raising excise in
the Customs Union as proposed above would
ultimately lead the prevalence rate of adult
smoking in these three countries to decline
from 37% today to 26% after 2020.
In absolute terms, some 19 million smokers would quit smoking in response to higher cigarette prices
including 3 million young people who would otherwise take up smoking.
The impact in terms of deaths avoided depends on the survival rate of adults who quit smoking. Health
studies show that at least 67% of those who would have otherwise died early from diseases caused by
smoking can avoid early death by quitting (IARC, 2011).
Overall, more than 4 million early deaths due to smoking would be averted in the future through higher
cigarette taxes and prices in the Customs Union countries.
| Page 16
TOBACCO CONTROL ECONOMICS TOBACCO FREE INITIATIVE PREVENTION OF NONCOMMUNICABLE DISEASES
6. References
Berman et al (2013). Estimating the cost of a smoking employee. Tobacco Control. 2013; 0: 1-6.
CDC (2013). Global Tobacco Control Surveillance System - GTCSS. Center for Disease Control and Prevention, Atlanta, United States.
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