25 Jun 2013
Calculating what needs to happen to meet a particular target
While government authorities have the responsibility of working out the policy details of targets, it will be helpful if you can calculate some ballpark figures to make a convincing case.
One tool to help do this is a web-based simulation tool developed by van Walbeek at the University of South Africa.41
This tool lets you enter different variables or assumptions about the impact of tax increases, and calculates various predicted outcomes.
For example, you can enter the population of your country, adult smoking prevalence, estimated elasticity and proposed tax increase amount to calculate the annual or long-term impact of the increase on consumption reduction, smoking prevalence reduction, and increase in government revenue. If you don’t have data from your own country, you can use data (such as prevalence and elasticity) from elsewhere that you would expect are similar for your country.
You can use the tool in two ways:
- If you set a tobacco use or public health target (for example, “Cut current adult smoking prevalence in half within 10 years”), you can then enter various combinations of data to find out how much the tax rate would have to increase by each year to achieve that target. This calculation lays out the fiscal policy the government needs to commit to if it expects to achieve the target.
- If you set a tax or affordability target (for example, “Increase the tobacco excise rate per stick by 10% each year for 5 years, adjusted for inflation and income), you can enter the proposed tax increase information to predict what impact this will have on smoking prevalence and tobacco-caused disease. If the impact is less than ideal, you can use this information to call for higher, more rapid tax increases.
41 Van Walbeek C. A simulation model to predict the fiscal and public health impact of a change in cigarette excise taxes. Tobacco Control 2010;19:31-36.