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Estimating cigarette tax avoidance and evasion: evidence from a national sample of littered packs
  1. Dianne C Barker1,
  2. Shu Wang2,
  3. David Merriman3,4,
  4. Andrew Crosby5,
  5. Elissa A Resnick6,
  6. Frank J Chaloupka6
  1. 1Barker Bi-Coastal Health Consultants, Inc, Calabasas, California, USA
  2. 2Department of Political Science, Michigan State University, East Lansing, Michigan, USA
  3. 3University of Illinois, Institute of Government and Public Affairs, Chicago, Illinois, USA
  4. 4Department of Public Administration, University of Illinois at Chicago, Chicago, Illinois, USA
  5. 5Department of Public Administration, Pace University, New York, New York, USA
  6. 6University of Illinois at Chicago, Institute for Health Research and Policy, Chicago, Illinois, USA
  1. Correspondence to Dianne C Barker, Barker Bi-Coastal Health Consultants, Inc., 3556 Elm Drive, Calabasas, CA 91302, USA; dcbarker{at}earthlink.net

Abstract

Introduction A number of recent studies document the proportion of all cigarette packs that are ‘contraband’ using discarded packs to measure tax avoidance and evasion, which we call tax non-compliance. To date, academic studies using discarded packs focused on relatively small geographical areas such as a city or a neighbourhood.

Methods We visited 160 communities across 38 US states in 2012 and collected data from littered cigarette packs as part of the State and Community Tobacco Control (SCTC) Research Initiative and the Bridging the Gap Community Obesity Measures Project (BTG-COMP). Data collectors were trained in a previously tested littered pack data collection protocol.

Results Field teams collected 2116 packs with cellophane across 132 communities. We estimate a national tax non-compliance rate of 18.5% with considerable variation across regions. Suburban areas had lower non-compliance than urban areas as well as areas with high and low median household income areas compared with middle income areas.

Discussion We present the first academic national study of tax non-compliance using littered cigarette packs. We demonstrate the feasibility of meaningful large-scale data collection using this methodology and document considerable variation in tax non-compliance across areas, suggesting that both policy differences and geography may be important in control of illicit tobacco use. Given the geography of open borders among countries with varying tax rates, this simple methodology may be appropriate to estimate tax non-compliance in countries that use tax stamps or other pack markings, such as health warnings.

  • Illegal tobacco products
  • Taxation
  • Public policy

This is an Open Access article distributed in accordance with the Creative Commons Attribution Non Commercial (CC BY-NC 4.0) license, which permits others to distribute, remix, adapt, build upon this work non-commercially, and license their derivative works on different terms, provided the original work is properly cited and the use is non-commercial. See: http://creativecommons.org/licenses/by-nc/4.0/

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