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AGI - Introducing a mechanism that limits wholesale prices of tobacco products and simultaneously increases taxation could generate up to £4.9 billion in additional revenue in five years, reduce the number of smokers, and prevent thousands of hospital admissions and deaths. This is indicated by a study conducted by the Tobacco Control Research Group of the University of Bath and the Sheffield Addictions Research Group of the University of Sheffield, led by Duncan Gillespie and Rob Branston and published in the journal Social Science & Medicine. The research provides the first applied simulation of a taxation system inspired by the ‘polluter pays’ principle, designed to reduce the power of tobacco companies to use price as a marketing tool and transfer some of the health costs generated by smoking onto the producing industry.
Health and Finance
According to the authors, the measure could produce simultaneous benefits for public health, for state finances, and for reducing social inequalities. The analyzed model predicts the introduction of a maximum ceiling on wholesale prices practiced by cigarette and other tobacco product manufacturers. The industry’s margin reduction would be compensated for by an increase in taxes, preventing final consumer prices from decreasing. In this way, the researchers explain, the additional revenue would primarily come from compressing the profits of companies in the sector and not from a direct burden on smokers or small retailers.
“With the approval of the Tobacco and Vapes Act, the British government has protected a generation from the harmful effects of smoking,” said Rob Branston, co-director of the Tobacco Control Research Group of the University of Bath: “Our research shows that there is a further opportunity for leadership by addressing the enormous profits of an industry that kills more than half of its regular consumers.” According to Branston, the measure would allow for greater tax revenue, health benefits, and particularly relevant benefits for the most disadvantaged segments of the population.
The Study
To evaluate the effects of the proposal, the Sheffield group developed a dynamic simulation based on 250,000 British people aged between 18 and 89. The researchers examined six different scenarios, varying the level of the price ceiling and the speed of introducing the measure, comparing them with a scenario in which no new interventions were adopted. In all analyzed cases a consistent trend emerged: reduction in the prevalence of smoking, increase in tax revenues, and improvement in health indicators. The most consistent effects were observed in the scenarios characterized by stricter price limits and higher tax increases. In particular, the immediate introduction of a rigid price ceiling could generate up to £4.9 billion by 2029. Projections to 2044 also indicate 1,636 fewer deaths attributable to smoking, almost 44,000 years of life gained, 10,073 avoided hospital admissions, and a significant reduction in health inequalities.
Benefits
The greatest benefits would be concentrated in the 20 percent most disadvantaged of the population, a group that currently has the highest levels of tobacco consumption and related diseases. “In all six modeled scenarios we observed the same pattern: a smaller variability of prices in the market, a reduction in the number of smokers, greater tax revenues, and fewer deaths and hospital admissions,” explained Duncan Gillespie, senior researcher at the School of Medicine and Population Health of the University of Sheffield and first author of the study: “Although industry revenues decrease, consumer spending remains essentially unchanged, demonstrating that it is possible to achieve significant improvements in public health without imposing additional financial burdens on citizens.” The study comes as debate continues in the United Kingdom on the introduction of fiscal tools that transfer a portion of the health and social costs derived from the consumption of its products to the tobacco industry.
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https://www.agi.it/scienza/news/2026-05-29/tassa-tabacco-vite-37273469/
