Wednesday , June 16 2021

How the tobacco industry mixes with government attempts to stop smoking



IIt is believed that two out of three smokers want to dig their deadly habit and for good reason – he believes that the same part of them die prematurely due to smoking. All over the world, this habit kills more than 6 million people a year.

However, quitting smoking is extremely difficult. Smoking is an addictive habit that the British Royal College of Physicians compares to addiction to heroin and cocaine.

But that does not mean that we can do nothing. Evidence suggests that increased taxation of tobacco products is the most effective way to reduce tobacco use. These taxes, recommended by the World Health Organization and the World Bank, raise the prices of tobacco products in stores, reducing their affordability – a situation that encourages smokers to quit and discourages others from starting work.

Taxation is especially important because smokers with lower income levels are less likely to respond to many other tobacco control campaigns and regulations to encourage quitting. However, such smokers, including many young people, are the most sensitive to price increases.

If addiction alone was not enough, the additional challenge to habit is that tobacco companies simply do not want smokers to quit smoking. They do not want to lose customers and the substantial profits they provide.

It is no surprise then that the tobacco industry has a well-documented history of challenging laws that are aimed at controlling the use and sale of tobacco in favor of public health. For example, the largest tobacco companies still sell cigarettes to children around the world, although they say they do not, and often in places where advertising is prohibited. In the United Kingdom, where the advertising of tobacco products was banned, Philip Morris International successfully celebrated this ban with its recently launched 'quit smoking' campaign, which is actually still promoting its tobacco products.

Paying with a heavy price

While many of these tactics are obvious, some are more difficult to detect. Our latest research reveals further – how the pricing policy of the tobacco industry in the UK minimizes the intended impact of tobacco tax increases on public health.

Tobacco companies offer a number of cheaper products that help people smoke (and encourage new customers to start their business), while offering a set of more expensive brands to really earn for those who can not or will not give up.

When tobacco taxes are increased, they play at their prices to undermine the impact of tax increases on smoking. They absorb tax increases, especially on the cheapest brands, delaying and increasing the assumed price increases of tobacco. In this way, price increases are gradually introduced into the brand portfolio so that smokers never face a sudden spike in prices when the government increases taxes.

Further tactics adopted by the industry include shrinkflation – cutting the number of cigarettes in a pack to disguise price rises and prevent the cost of a packet of tobacco being tipped over certain psychological levels.

Reducing the number of cigarettes in a pack from 20 to 19, 18 or even 17, while keeping the price stable means the higher cost per cigarette isn’t immediately obvious to most smokers – and the producer can make greater profits.

The industry also used price marked packaging to limit the ability of retailers to increase their small markup on tobacco sales as a further way of keeping tobacco cheap. Sales of 10-cigarette packs increased and very small packs of loose tobacco (10g or less) were introduced. These small packets appeal to the most price sensitive smokers as they cost less to buy.

Such tactics and small packs have recently been banned in the UK with the introduction of standardised packaging (where tobacco has to be sold in a standardised format with drab packaging) but are still available elsewhere. The UK has also introduced a new minimum excise tax which puts the average price at over £10 for a packet of 20 cigarettes stopping the sale of ultra-cheap mainstream tobacco products.

Ultimately the tobacco industry wouldn’t be manipulating price if it wasn’t so effective in ensuring young people take up smoking and in preventing existing smokers from quitting. So what more can we do?

Stubbing it out

Further restricting industry use of pricing tactics would be a good option. Companies could be limited in the number of brands and brands variants they sell to cut down on the range of prices on offer, and in the number of times they can change prices in order to remove their ability to smooth prices and directly undermine the public health benefits of tax increases.

There is even a case for directly regulating tobacco prices in the same way that prices for public utility services, such as water and electricity are often determined by independent government agencies. Public utilities are important services, which is why the government looks to protect the public from company pricing choices – but then tobacco is a very addictive and deadly product where price matters too.

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Meanwhile, Bloomberg Philanthropies recently announced a $20m (£16m) investment to create Stop (Stopping Tobacco Organisations and Products) – a global tobacco industry watchdog to help expose more of these practices. The Tobacco Control Research Group at the University of Bath is one of three partners funded to lead this initiative.

The public can cannot afford to let the industry operate under the radar when the product they make kills two out of three long term users. This new partnership will serve as a necessary watchdog to expose their deadly tactics.

Anna Gilmore is a professor of public health and director of the Tobacco Control Research Group, J Robert Branston is a senior lecturer in business economics and Rosemary Hiscock is a research associate at the University of Bath. This article first appeared on The Conversation (theconversation.com)


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