Improving Tobacco Tax Policies in The Republic of Albania

Tobacco consumption in Albania remains one of the highest in Western Balkans (WB) based on 2015 data from the World Health Organization. According to the Tobacco Atlas, more than 4,100 Albanians die as a result of tobacco-related diseases every year. Additionally, more than 1,000 children (10-14 years old) and 398,000 youth and adults (15+ years old) continue to use tobacco each day, costing an estimated amount of 270 million Euros to the Albanian economy every year.

Tax policies on tobacco products are considered to be the most efficient not only for reducing tobacco consumption, but also for their positive impact on budget revenues. Also, tobacco taxes are relatively easy to collect with low administration costs due to a small number of producers and large sales volumes. The positive impact of taxes on reducing tobacco consumption has been confirmed in several empirical studies from developed and developing countries. A study carried out by Development Solutions Associates (DSA)16 shows that an increase in excise taxes on tobacco products could reduce tobacco consumption and increase government revenues.

A corresponding Report can be found here.