Impacts of Tobacco Tax Increases on Tax Revenues and Public Health in Serbia: A Simulation Model (2023)

Impacts of Tobacco Tax Increases on Tax Revenues and Public Health in Serbia: A Simulation Model (2023)

This research aims to estimate the impact of an increase in tobacco excise taxes on tobacco consumption, government revenues from tobacco, premature deaths, and youth initiation in Serbia. A simulation model is developed to predict the effects of tobacco excise increases on budget revenues from tobacco as well as on public health. The simulation assumes an annual increase in the specific excise per pack of 15 percent from its base value which leads to an increase in cigarette prices of 9.7 percent in the first year and 10.6 percent in the second year. In brief, the simulation demonstrates that tax revenues would be higher, while the smoking prevalence would be lower.

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