“The drop is striking because it is an inelastic product, that is to say that even if its price rises, the demand does not vary as much, but the inflation of these years has affected consumption, in addition there are new stricter restrictions and there are fewer spaces to smoke” , explained José Luis Clavelina, Director of Research at the Center for Economic and Budgetary Research (CIEP).
On January 15, 2023, modifications to the Regulations of the General Law for Tobacco Control came into force that prohibit the advertising, promotion and sponsorship of tobacco through any means of communication, in addition to its direct and indirect display at points of sale. .
The restriction of its consumption in places such as squares, parks, beaches, stadiums, public transport and schools of all educational levels was also extended.
They hit vapers
This drop in the IEPS, due to lower consumption, “also has to do with the growing awareness that smoking is harmful to health among society. But equally, there are people who are turning to vapers, even when they are more expensive. These vapers are prohibited and since they are, there is no official information about it,” said Clavelina.
The information that is lacking is how harmful vapers or electronic cigarettes are to health, and also when they are sold illegally, it is not known if they pay taxes such as IEPS or VAT, explained the CIEP researcher.
According to a 2022 National Commission Against Addictions survey, among the Mexican population between the ages of 12 and 65, 975,000 people use vapers, and 5 million have ever used them. Cofepris has issued alerts for the damage to health they cause, and despite their ban in May of last year, they are easy to buy in any establishment on public roads, including mini-supermarkets.
“A problem in the medium and long term is that these people can develop illnesses due to the consumption of tobacco in vapers, who will require public health services,” said the specialist.
The point is that the IEPS is a tax that has the objective of discouraging the purchase of tobacco, and in theory, the proceeds would have to go to public health institutions for anti-smoking campaigns and treat related diseases, but this money is not labeled and is they go to a general bag.
A CIEP study states that the cost of treating illnesses associated with tobacco consumption is 48,223 million pesos, however, the Ministry of Health’s spending to prevent and treat tobacco-related diseases ranges from 2,500 million.