Price of legal and illegal cigarettes favors initiation of teenagers

Research released this Monday (28) by the National Cancer Institute (Inca), in Rio de Janeiro, reinforces a fact that was observed by researchers from the Ministry of Health agency a few years ago.

The price of cigarettes manufactured in Brazil, as well as smuggled cigarettes, is very low. “Since 2017, there has been no readjustment, neither the tax on tobacco products nor the minimum price established by law. The price has been frozen since the end of 2016”.

The information is from the doctor and scholar of the Population Research Division – Prevention and Surveillance Coordination (Conprev) of Inca, André Szklo, author of the unpublished study The cigarette market in Brazil: new evidence on illicit practices from the 2019 National Health Survey [O mercado de cigarros no Brasil: novas evidências sobre práticas ilícitas a partir da Pesquisa Nacional de Saúde 2019].

The survey was carried out in partnership with the University of Illinois, in Chicago, United States, and published in Tobacco Controlone of the world’s leading tobacco control journals.

André Szklo stated that, as a result, the price is losing its real value every year and is becoming more accessible to the population. Internally, the industry does not carry out a nominal increase in the price of the product.

“It’s a strategy that ends up marrying: there is no readjustment of the tax policy on tobacco products and the industry pressures for the price to stay low, to inhibit smuggling. And what we are already observing is a natural reflection in the proportion of smokers among young people and adolescents, especially girls”,

accentuated.

Initiation

Thus, the population of young adults and adolescents, who do not have as many financial resources, is the one that will end up “benefiting” from a cheaper price of cigarettes. It means that this will favor initiation.

“We are already observing this, that there is an increase in the proportion of smokers among adolescents and young people”, said Szklo. For him, the proportion of young adults that had been falling since 1989 stopped falling and this is a direct reflection of the weakening of the main price and tax policy, which is the main guideline to prevent smoking initiation.

The Inca researcher reiterated that the relationship between the price of legal cigarettes and illegal cigarettes has never been so low, but denied that the main solution to curb smuggling is to reduce the price internally. More than 25% of illegal brands circulating in the country are sold at an amount equal to, or slightly higher than, the minimum price established by law for legal cigarettes, which has been stagnant at R$5 a pack since 2016.

The average price of cigarettes purchased by Brazilian smokers reaches R$5.68. In states bordering Paraguay, the value drops to R$ 4.96.

“This difference is so small that we have almost a combination of the price of the legal product with the illegal product. The study concludes that, in some regions, this is more critical and that the consumption of illegal cigarettes also favors the initiation of the smoking habit”,

stressed.

The doctor also said that, since 2017, the participation of the illegal market has been falling in the Brazilian market because the legal product is practically being sold at the same price as the illegal cigarette.

The reflection of this is in health.

“When you have an increase in the proportion of smokers, this will generate a cost for the country. Nowadays, Brazil spends BRL 125 billion – between direct and indirect costs – on diseases related to the use of tobacco products, and the collection, for example, of the tobacco industry does not cover even 10% of that”,

highlighted.

New generation

He argued that, when you see the price of legal cigarettes so cheap, you realize that this will lead to financial loss for the country in the short, medium and long term.

“We are having a new generation of smokers who are replacing a portion of the current population that, unfortunately, will die”, revealed.

Studies published in the country indicate that two out of three current tobacco users will die as a result of using these products.

“So, there is a need for the tobacco industry to replace this population, which currently generates profit. This is what happens when we have this low price”,

assured.

Solution

The researcher also argued that the solution to this whole scenario is to increase the price of cigarettes manufactured in Brazil, to resume tax policy by increasing the tax rates on tobacco products, to readjust the minimum price established by law and, in parallel, implement the Protocol to Eliminate Illicit Trade in Tobacco Products, ratified by the State in 2018.

“There is a measure planned for Brazil to combat the illegal market. It is a measure of the State that ratified this protocol and needs to implement it. These are two measures that have to go hand in hand”,

said the doctor and researcher at Inca.

He also pointed out that the tax reform, which is being discussed in the National Congress, is a “golden opportunity” to strengthen this need for the selective tax on tobacco products, in order to ensure that the collection of this selective tax can be reversed in treatment and prevention actions and in awareness initiatives, aiming to inhibit this initiation to smoking and, also, to encourage the cessation of the habit among current smokers.

Brazilian legal cigarettes are the second cheapest in the Americas. After the 2012 tax reform, the average price of the legal product was almost 150% higher than that of the illegal cigarette. Today, that difference has halved.

Still according to the survey, around 40% of cigarettes consumed in the national territory still belong to brands that enter Brazil illegally. Since 2016, there has been a decrease in the proportion of consumption of these products in the states, but the percentage is still high.

The survey data will be detailed during a virtual event promoted by Inca this Tuesday (29), when the National Day to Combat Tobacco is celebrated, broadcast by TV Inca, in YouTube. To participate, interested parties must access the link.

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