Tax, price and cigarette brand preferences: a longitudinal study of adult smokers from the ITC Mexico Survey
Open Access
- 10 October 2013
- journal article
- research article
- Published by BMJ in Tobacco Control
- Vol. 23 (suppl 1), i80-i85
- https://doi.org/10.1136/tobaccocontrol-2012-050939
Abstract
Background Recent tax increases in Mexico differed in structure and provided an opportunity to better understand tobacco industry pricing strategies, as well as smokers’ responses to any resulting price changes. Objectives To assess if taxes were passed onto consumers of different cigarette brands, the extent of brand switching and predictors of preference for cheaper national brands. Methods Using data from three waves of the Mexican administration of the International Tobacco Control Survey, we analysed self-reported brand and price paid at last cigarette purchase. Generalised estimating equations were used to determine predictors of price and preference for national brands. Results The average price of premium/international brands increased each year from 2008 to 2011; however, the price for discount/national brands increased only from 2010 to 2011. The percentage of smokers who smoked national brands remained stable between 2008 and 2010 but dropped in 2011. Factors related to smoking national brands as opposed to international brands included being male and having relatively older age, lower education, lower income and higher consumption. Conclusions Tobacco industry pricing strategies in the wake of ad valorem taxes implemented in Mexico prior to 2011 had the impact of segmenting the market into discount national brands and premium international brands. The specific tax increase implemented in 2011 reduced the price gap between these two segments by raising the price of the national brands relative to the international brands. Evidence for trading up was found after the 2011 tax increase. These results provide further evidence for the relevance of tax policy as a tobacco control strategy; in particular, they illustrate the importance of how specific rather than ad valorem taxes can reduce the potential for downward brand switching in the face of decreasing cigarette affordability.Keywords
This publication has 19 references indexed in Scilit:
- Understanding tobacco industry pricing strategy and whether it undermines tobacco tax policy: the example of the UK cigarette marketAddiction, 2013
- Consumption of single cigarettes and quitting behavior: A longitudinal analysis of Mexican smokersBMC Public Health, 2011
- Self-reported price of cigarettes, consumption and compensatory behaviours in a cohort of Mexican smokers before and after a cigarette tax increaseTobacco Control, 2010
- Estrategia de vigilancia para el control del tabaco en México: publicidad, promoción y patrocinio, empaque y etiquetadoSalud Publica de Mexico, 2010
- Cigarette brand preference as a function of price among smoking youths in Canada: are they smoking premium, discount or native brands?Tobacco Control, 2009
- Does the availability of single cigarettes promote or inhibit cigarette consumption? Perceptions, prevalence and correlates of single cigarette use among adult Mexican smokersTobacco Control, 2009
- Smoke-free policies and the social acceptability of smoking in Uruguay and Mexico: Findings from the International Tobacco Control Policy Evaluation ProjectNicotine & Tobacco Research, 2009
- The impact of taxation on tobacco consumption in MexicoTobacco Control, 2008
- The conceptual framework of the International Tobacco Control (ITC) Policy Evaluation ProjectTobacco Control, 2006
- Curbing the epidemic: governments and the economics of tobacco controlTobacco Control, 1999