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2. Consumption of New and Emerging Tobacco and Nicotine Products in Zambia: Implications for Policy
- Author:
- Shimukunki Manchishi, Edna Kabala, and Mulenga Chonzi Mulenga
- Publication Date:
- 04-2022
- Content Type:
- Working Paper
- Institution:
- Zambia Institute for Policy Analysis and Research (ZIPAR)
- Abstract:
- The global economy has in recent years observed a rapid increase in the consumption of New and Emerging Tobacco and Nicotine Products (NETNPs). Consumers of the NETNPs in Zambia and elsewhere justify consumption of these products on grounds that they are less harmful and expose them to fewer health risks compared to traditional tobacco smoke. However, studies have shown that these NETNPs do not entirely filter out harmful chemicals from tobacco as presumed by many people, and in some cases may even expose smokers to more smoke over longer periods of time as is the case of water pipe (shisha). This study investigated the consumption and taxation of NETNPs in Zambia to generate knowledge and come up with evidence-based policy recommendations aimed at informing appropriate stakeholders on the consumption and taxation of NETNPs. The study employed a mixed methodology encompassing a desk review, a survey of 400 respondents and key informant interviews. In terms of the consumption of NETNPs, the study revealed that a majority of those surveyed consume water pipe, which ranked highest among the NETNPs consumed in Zambia. Other NETNPs commonly consumed include bidis, e-cigarettes and dry snuff (nsunko). The consumption of these products varied according to the economic status of the consumers, with products such as snus and e-cigarettes being much more preferred and consumed by those in employment because they can afford more costly products. Meanwhile, products such as water pipe and bidis were the products of choice among those not employed and this could also be attributed to the relatively lower cost of the products. Regarding the socio-demographic characteristics of the surveyed sample, the study established that most of the consumers of NETNPs were young, unmarried males. A notable finding in the study was that those who had attained tertiary level of education were the biggest consumers of NETNPs. With regards to taxation of NETNPs, the study has found that there is potential to increase taxes substantially based on consumers’ willingness to pay which would require very high tax levels to deter consumption. This would require the government to considerably increase excise taxes on these products which would ultimately increase their price and hence curtail their consumption. The study has established that the taxation of all tobacco products in Zambia is the sole responsibility of the ZRA which draws its mandate from various provisions of the Zambian law. Broadly there are eight categories used to classify tobacco and nicotine products based on the HS codes. This broad classification forms the basis for taxation of tobacco and nicotine products in Zambia. The study has established that there are four main taxes applied on tobacco products in Zambia, these include: a 25% customs duty levied on the value of the product imported; a VAT of 16% on the value of the product; a 5% surtax; and excise duty of 145% of the value for duty purposes (VDP) or K355 per kg for all tobacco products.
- Topic:
- Health, Digital Economy, Business, Tax Systems, Public Policy, Tobacco, Public Health, and Gender
- Political Geography:
- Africa and Zambia