Comparative analysis of the impact of cigarette taxation on consumption, revenue and mortality in Jordan.

Abstract

Background: Tobacco taxes are a powerful tool for reducing tobacco consumption and a reliable source of revenue for government.

Aim: To investigate the potential efficacy of tobacco taxation strategies in Jordan in relation to their fiscal and health-related outcomes.

Methods: Using Tobacconomics, we conducted a comparative analysis of several taxation scenarios: maintaining the status quo; increasing both specific excise and tiered taxes; increasing tiered tax rates alone; and raising specific excise taxes only.

Results: We obtained the projected fiscal and health outcomes under the different tax policy scenarios: current scenario with no adjustments; 20% increase in specific excise taxes coupled with a 10% boost in tiered tax rates; raising tier tax by 20%; and raising specific excise by 20%. A 20% increase in excise taxes will decrease cigarette consumption, increase government revenues and reduce deaths among adults and adolescents. It can provide up to 87.5% reduction in adolescent deaths if coupled with a 10% boost in tiered tax rates.

Conclusion: A consistent and aggressive approach to tobacco taxation can effectively decrease tobacco consumption and increase government revenue if Jordan's multi-tiered specific excise tax system is adjusted according to retail price.