s well (e.g., Article 6.2b). The existence of a substantial illicit market, or the threat that illicit trade will increase, can jeopardize future excise tax increases. This can be both real in that it undermines www.selleckchem.com/products/carfilzomib-pr-171.html the effect of the tax or latent in that the threat of increases in illicit trade prevents increases in tax from taking place. TRENDS IN CIGARETTE TAXATION, PRICING, AND CONSUMPTION The FCTC encourages Parties to raise the excise tax on tobacco products, but does not set specific targets. The targeted level of excise tax (expressed either in a common currency or as a percentage of the retail price) and/or the rate at which the excise tax should increase from year to year is necessarily arbitrary. However, some organizations have set benchmarks or targets.

For example, the World Bank recommends that excise and sales taxes combined should comprise between 67% and 80% of the retail price of cigarettes (Jha & Chaloupka, 1999). The WHO recommends that excise taxes should account for at least 70% of the retail price (WHO, 2010). The latter recommendation sets a particularly high bar, and according to WHO data (WHO, 2011) is currently met by only five countries (Cuba, San Marino, Fiji, Egypt, and the United Kingdom). The European Union sets a minimum excise tax burden of 57% of the retail price (with a minimum tax floor of �64 per 1,000 cigarettes), to be increased to 60% (with a minimum �90 per 1,000 cigarettes) as of January 1, 2014 (Council Directive 2010/12/EU). None of the international organizations have set specific targets for the retail price of cigarettes.

Comparable price and tax data over long periods of time exist for a limited number of countries, mainly HICs. Based on a sample of 31 HICs and 21 LMICs, van Walbeek et al. (forthcoming) found that real, inflation adjusted cigarettes prices increased in nearly all HICs between 1990 and 2008, but that they decreased in more than half of the LMICs during the same period. These trends, together with rapid economic growth in LMICs can explain the divergence in cigarette consumption trends between the HICs and the LMICs. Cigarette consumption in HICs decreased from 1.8 trillion to 1.4 trillion cigarettes between 2000 and 2009, while cigarette consumption in LMICs increased from 3.4 trillion to 4.5 trillion cigarettes over the same period (van Walbeek et al., forthcoming).

As a result, global aggregate cigarette consumption increased from around 5.2 trillion cigarettes in 2000 to 5.9 trillion cigarettes in 2009. WHAT IS KNOWN IN THE SCIENTIFIC LITERATURE? Price and Consumption Many studies have investigated the determinants of cigarette demand. Until the 1980s, these studies used time Entinostat series data focusing exclusively on HICs (Baltagi & Goel, 1987; Warner, 1977). Chapman and Richardson��s study of cigarette demand in Papua New Guinea in 1990 was the first time series�Cbased tobacco demand study using LMICs data. Despite differences in the individual countries, the quality of data, and the met