The Effectiveness of Tax Policy Changes In Montenegro – Smoking Behavior by Socioeconomic Status (2019)

The effectiveness of tax policy changes in Montenegro – smoking behavior by socioeconomic status

This ISEA research focuses on the effectiveness of tax policy changes in Montenegro for the reduction of cigarette consumption and prevalence, especially in the context of socioeconomic status. Global evidence demonstrates that tobacco taxation policy is one of the most effective tools to reduce smoking prevalence, specifically among youth and low-income group.

Data from Montenegrin Household Budget Survey shows a decreasing trend in the consumption of cigarettes (2006-2017) across all income groups, which is a result of price increases. Even if poorer households spend less on cigarettes, they allocate a larger share of their budget on tobacco compared to wealthier groups. On the other hand, as expected, the high-income group has the highest total expenditure on cigarettes.

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