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Open AccessArticle

Illicit Cigarette Consumption and Government Revenue Loss in Vietnam: Evidence from a Primary Data Approach

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Department of Economics, Ball State University, Muncie, IN 47306, USA
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Department of Economics, Thuongmai University, Hanoi 10000, Vietnam
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Vietnam Academy of Social Sciences, Hanoi 10000, Vietnam
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Department of Health Behavior, University of North Carolina-Chapel Hill, Chapel Hill, NC 27599, USA
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School of Economics, University of Cape Town, Rondebosch 7700, South Africa
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Innovation+Design Enabling Access (IDEA) Initiative, Department of International Health, Johns Hopkins Bloomberg School of Public Health, Baltimore, MD 21205, USA
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Author to whom correspondence should be addressed.
Int. J. Environ. Res. Public Health 2019, 16(11), 1960; https://doi.org/10.3390/ijerph16111960
Received: 26 February 2019 / Revised: 25 May 2019 / Accepted: 27 May 2019 / Published: 2 June 2019
(This article belongs to the Special Issue Tobacco Control: Policy Perspectives)
This article provides the first comprehensive picture and independent estimates of both illicit cigarette consumption and the resulting government tax revenue loss in Vietnam using data from a representative survey of cigarette smokers in 12 Vietnamese provinces. The survey consisted of face-to-face interviews and on-site cigarette pack examinations. We find that more than 720 million illicit cigarette packs, or 20.7% of total cigarette consumption, circulated in Vietnam in 2012. Consequently, government tax revenue loss due to illicit trade ranged from US $223 to 295 million. Our estimates also indicate that (1) the most popular illicit brands were Jet and Hero, both were sold at higher prices than the average legal brand; (2) the average price of illicit cigarettes was 51% higher than the average price of legal cigarettes; and (3) majority of illicit cigarettes were sold at convenience stores, which were registered and licensed businesses. Our findings suggest that prices are not a driver of illicit cigarette consumption in Vietnam, and this illicit trade is at least partially a consequence of weak market control enforcement. View Full-Text
Keywords: Illicit trade; tobacco; tax avoidance; cigarette smuggling; cigarette price; primary data; pack examination; Vietnam Illicit trade; tobacco; tax avoidance; cigarette smuggling; cigarette price; primary data; pack examination; Vietnam
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MDPI and ACS Style

Nguyen, M.T.; Dao, S.T.; Nguyen, N.Q.; Bowling, M.; Ross, H.; So, A.D. Illicit Cigarette Consumption and Government Revenue Loss in Vietnam: Evidence from a Primary Data Approach. Int. J. Environ. Res. Public Health 2019, 16, 1960.

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