Using wave 5 of the National Income Dynamics Study (conducted in 2017), this paper investigates the market for very low-priced cigarettes in South Africa, which, in all probability, are illicit. 0800 22 6622 There was also a noticeable drop in government excise revenue in 2010 (Fig. The World Health Organization’s Protocol to Eliminate Illicit Trade in Tobacco Products (ITP), which became effective on 25 September 2018, includes recommended best practices for curbing illicit trade. Research Unit on the Economics of Excisable Products (REEP), University of Cape Town, Cape Town, South Africa, Kirsten van der Zee, Corné van Walbeek & Sibahle Magadla, You can also search for this author in Decide to quit and set a quit date (start mentally preparing yourself to quit), making sure that you have a support system to help ensure you quit for good. The next step is to get permission to market the cigarettes as a low-nicotine alternative. #CANSAadvocacy. KwaZulu-Natal, the province with the lowest prevalence of illicit cigarette purchases, has the country’s busiest seaport. Give a gift to our CANSA Care Homes to help support critical services for cancer patients who are vulnerable to COVID-19. Camel Blue has relatively low nicotine and tar level. An important finding is that the prevalence of illicit cigarettes does not differ much between the nine provinces of South Africa. }_i=\frac{Tot\ {Exp}_i}{30}\\ {} if\ 12\le Tot\ {Exp}_i\le 90\\ {}\&\kern0.5em \frac{Tot\ {Exp}_i}{Sticks_j}<0.5\end{array}} $$, $$ {\displaystyle \begin{array}{l}{\raisebox{1ex}{$\mathit{\Pr}$}\!\left/ \!\raisebox{-1ex}{$ Cig$}\right. Econ Inq 33:189–202, SADHS (2016) National Department of health, statistics South Africa, South African Medical Research Council, and ICF, vol 2016. Most cigarettes contain a "reconstituted tobacco" product known as "sheet", which consists of "recycled [tobacco] stems, stalks, scraps, collected dust, and floor sweepings", to which are added glue, chemicals and fillers; the product is then sprayed with nicotine … We would also like to thank Nicole Vellios for reviewing this document, and for her helpful comments and feedback. We assess the socio-economic correlates of smoking cheap cigarettes using the following specification: Where SmokerCheapiP is an indicator variable for whether smoker i purchases cigarettes at price threshold P, where P < R16.30, P < R20, P ≤ R20, or P < R23. For comparison, BAT’s Peter Stuyvesant, the most popular brand in South Africa, sold for about R35 per pack in 2017 (ACP 2019). And if at first you don’t succeed, evaluate where you think things went wrong, put measures in place to prevent the same mistake into the future and most importantly, try, try and try again! Nearly 28% of learners Gr. The HRIU was identified as the “rogue unit” and was disbanded, together with a number of other specialized units in SARS. Available at: https://web.archive.org/web/20190311091719/http:/www.tobaccosa.co.za/wp-content/uploads/Ipsos-Tobacco-Market-Study-REPORT.pdf. 20 Sept 2018, Merriman D, Yurekli A, Chaloupka FJ (2000) How big is the worldwide cigarette smuggling problem. Although South Africa has not ratified the ITP, the Minister of Finance in 2018 committed the government to “extend the use of ‘fiscal markers’, which are required under the tracking and tracing obligations of the World Health Organization’s Protocol to Eliminate Illicit Trade in Tobacco Products” (National Treasury 2018). It’s not likely that you would and yet research shows that this is exactly what you do when you light up. Of the nine provinces, Gauteng, the economic heartland of South Africa and the province where most cigarettes are manufactured, has the second-highest prevalence of illicit trade. 1), the first substantial decrease in more than 25 years. Am J Epidemiol 173:355–359, Goel RK (2008) Cigarette smuggling: price vs. nonprice incentives. The marginal effect of around −0.04 for all price thresholds indicates that a 10% increase in per capita household income decreases the likelihood of purchasing cheap cigarettes (at the chosen price threshold) by 0.4%. In the months following Moyane’s appointment, many key executives and experienced officials, including the head of the HRIU, were suspended (Judge Nugent 2018a, b). Decisive action needs to be taken. 2018). Surveys of cigarette prices in South African townships indicate that cheap single sticks are sold mostly for R0.50 or R1.00 (Liedeman and Mackay 2015; ACP 2019).   info@cansa.org.za, 2021 The Cancer Association of South Africa. Research showed tobacco use was often initiated and established during adolescence and young adulthood (90% of smokers start the habit by age 18 and 99% start by age 26), so it made sense for them to target young people, who would then become addicted to their products and potentially hooked for life. Individuals may not answer truthfully about whether they are smokers, or the number of cigarettes they smoke, because there may be stigmas associated with smoking, especially for specific demographic and cultural groups (Pérez-Stable et al. Packs with 10 cigarettes are the most expensive at R38.20 per 20-pack equivalent, followed by single sticks at R37.17. Testing has highlighted that e-cigarettes vary widely in the amount of nicotine and other chemicals they deliver, and this is not communicated to buyers. SALDRU working paper number 227, National Treasury (2018) Budget reviewN Treasury Available at: https://web.archive.org/web/20181127103940/http://www.treasury.gov.za/documents/national%20budget/2018/review/FullBR.pdf, Pauw J (2017) President's keepers. 24 Nov 2013, Baltagi BH, Levin D (1986) Estimating dynamic demand for cigarettes using panel data: the effects of bootlegging, taxation and advertising reconsidered. Our analysis uses responses from the adult questionnaire only, since the child questionnaire does not have tobacco-related questions. Although our data does not allow us to investigate the source of the illicit cigarettes, we can make inferences from the provincial data. A higher proportion of females purchase cheap cigarettes than males at all price thresholds. Using both descriptive statistics and regression analysis, we investigate which demographic, geographic and product-specific characteristics are associated with illicit trade. Categories: No-Tobacco Campaign. He has authored/co-authored over 100 peer-reviewed scientific publications in local … Cape Town: southern Africa labour and development research unit [implementer], vol 2018. - 104.131.72.149. Under the codename “Project Honey Badger”, the then-head of the HRIU wrote to the two tobacco industry bodies (representing the majority of cigarette manufacturers) and other independent manufacturers in 2013 and 2014, warning them that SARS was aware of illicit activity in the industry, and that it would be intensifying its formal investigations into tobacco-tax evasion and other forms of tax abuse (Bailey 2013; Pauw 2017). CANSA appeals to young people, to be aware of these tactics and understand that these alterations to products, while enhancing the experience, do nothing to reduce the long-term negative effects of smoking or the risk for several cancers. African Capacity Building Foundation, award number 28741. Ind is a vector of individual characteristics including gender, race, age, education, employment status, marital status, the importance of religion, and the number of cigarettes smoked per day. Since the sum of the excise tax and VAT in 2017 amounted to R16.30 (1.22 USD) per pack, any cigarettes selling for R20 (1.50 USD) per pack or less are likely to be illicit, assuming reasonable production costs. Tob Control  https://doi.org/10.1136/tobaccocontrol-2018-054798, World Health Organization (2013) Framework convention on tobacco control. 2018). 2019). With regard to individual-level characteristics, the likelihood of purchasing cheap cigarettes varies substantially by race. More damage expected in Sunday Times fake news fallout. The illicit tobacco trade often has the biggest impact on individuals in low socio-economic groups, as these smokers are most sensitive to prices (International Agency for Research on Cancer 2011). We owe our success to all our employees and together we aim to become the fastest growing tobacco company in … The average yield of tar per cigarette varied between 30 and 38,5 mg in 27 brands and between 20 and 30 mg in all but one of the other 42 brands. A judicial commission, under the chairmanship of Deputy Chief Justice Raymond Zondo, was established in 2018 to investigate state capture in South Africa. The first wave of the NIDS survey was conducted in 2008, with a sample of roughly 28,000 individuals, in 7300 households, most of whom have been re-interviewed approximately every 2 years since. Appl Econ 42:545–561. Quitting tobacco use can have a positive effect on your health and lifestyle including: Ten years after quitting smoking, personal cancer risk is half that of a smoker, and immediate health benefits may be experienced. For prices