Rethinking tobacco policy: Why a Cap-and-Levy scheme can outperform the UK’s sales ban
Year: 2025
Type: article
Abstract: The United Kingdom aims to be smoke-free by 2030, and in pursuit of this goal, has proposed a Generational Sales Ban (GSB). While somewhat innovative, the GSB exclusively targets future generations, potentially overlooking the immediate health burdens and illicit market risks associated with current smokers. This study argues for a cap- and-levy scheme as a more comprehensive and efficient alternative. By directly addressing supply, consumption, and state tax revenues, a cap-and-levy approach offers a broader impact on smoking prevalence including existing smokers, while potentially mitigating the unintended consequences of a sales ban, such as fuelling the illicit trade and reducing tax revenues. The provision of accessible and appealing alternatives to combustible tobacco is crucial in minimizing the appeal of illicit products under any restrictive policy. This analysis suggests that a cap-and-levy mechanism warrants consideration as a policy instrument that could outperform the GSB in achieving significant and immediate reductions in smoking-related harm, without the unintended consequences that the GSB would produce. Highlights The UK remains short of the 2030 smoke-free goal despite declining smoking rates. The government proposes a Generational Sales Ban (GSB) prohibiting sales to those born after 2009. Studies suggest that GSB may fuel the illicit tobacco market (26% of UK consumption) and reduce tax revenues. This study advocates a cap-and-levy scheme as a more effective alternative for achieving the UK’s smoke-free ambitions. Providing appealing alternatives curbs illicit tobacco use under strict regulations.
Source: Research in Economics
Author: Joan E. Madia
Institution: University of Oxford
Language: English
Subfield: Physiology
Field: Medicine
Domain: Health Sciences
Open Access status: hybrid
Estimated APC paid: $2,950
OpenAlex ID: W4413922656