Extended cost-benefit analysis of tobacco taxation: The case of Serbia

Extended cost-benefit analysis of tobacco taxation: The case of Serbia

Jovan Zubović, Olivera Jovanović, Boban Nedeljković Institute of Economic Sciences, Belgrade, Serbia

November 2-3, Tirana, Albania

  • WHO (2021) estimation: more than 8 million die each year from tobacco use
  • Tobacco use will be the most significant cause of premature mortality and disability in the world by 2030.
  • USA CDC estimates: 20% to 40% of premature deaths are preventable through lifestyle modification such as smoking cessation or consumption of healthier foods.
  • Smoking imposes a risk for many chronic non-communicable diseases

Background

Cigarette tobacco smoke contains over 7,000 different chemical compounds, over 250 of which are dangerous to health, almost 70 cause cancer (Kilibarda, 2021)

Smokers today have a higher risk of lung cancer than smokers 50 years ago (changes in cigarette design and composition)

Smokers with lower personal or family income are more likely to suffer from tobacco-related diseases than smokers with higher personal or family income

As a result of tobacco use, smoking households spend less on food, clothing, education, and health care (Vladisavljević et al., 2021)

Background 2

To analyze the impact of raising tobacco taxes on avoiding the social and health costs of tobacco consumption

To apply the extended cost-benefit analysis (ECBA) methodology decomposed into four components:

  • changes in the disposable household budget reduction in tobacco-related medical expenditures extension of working life years
  • extension of pension years