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Learning Objectives
At the conclusion of this presentation attendees will be able to:
- Recognize the relationship between consumption of tobacco products and their cost; describe the various methods tobacco companies use to reduce the price of tobacco products at the wholesale and retail levels; and understand how these methods undermine the impact of state tobacco taxes.
- Describe policy options that can be used to restrict tobacco price discounting, including robust minimum price laws, limitations on coupon redemption, and restrictions on retail and wholesale price discounting programs.
- Explain the legal issues that may be implicated by these policy measures.
Key Points: Numerous studies show that increasing the price of tobacco products leads to a decrease in their consumption. Tobacco companies spend more than three-quarters of their marketing and advertising dollars on reducing the price of their products at the point-of-sale. This promotional spending undermines the effectiveness of tobacco excise taxes, one of the central pillars of tobacco control efforts. This presentation will discuss policy options that state and local governments can employ to counteract the industry’s price promotion activities. We will first discuss the methods that tobacco companies use to discount their products, with a particular emphasis on how price discounting strategies have been used to target different demographic groups. We will then review policy options that can be implemented (or enhanced) in order to counteract these price promotion strategies. Finally, we will review the legal issues relevant to such policies.
Educational Experience: A 30-minute discussion will follow brief presentations from the panel. In addition to answering attendees’ questions, the panel will develop discussion questions on strategies to increase the price of tobacco products through non-tax policies.
Benefits: Participants will understand how tobacco industry price discounting undermines public health efforts to reduce tobacco use through higher prices, and what policy options can be utilized to combat the industry’s price manipulation strategies.