Expansion of low-price cigarette market and its implications for cigarette tax revenue: Evidence from Bangladesh.

ABSTRACT:

Introduction

In Bangladesh, a significantly lower minimum retail price and preferential ad valorem tax rate for low-price cigarettes incentivized manufacturers to avoid tax by expanding the low-price cigarettes market. The effect of this industry response on government tax revenue has not been quantified yet. This study aims to fill this gap.

Methods

Using cigarette sales data (2019-2020) of British American Tobacco (BAT) Bangladesh in the WHO Tobacco Tax Simulation Model, we estimated the gap of actual from potential revenue by simulating four counterfactual scenarios involving government tax interventions and cigarette manufacturers' decision to expand low-price cigarette sales. We analyzed optimal government policy response vis-à-vis manufacturers' actions in a game theor

SUBMITTER: Hossain MN 

PROVIDER: S-EPMC12535224 | biostudies-literature | 2025

REPOSITORIES: biostudies-literature