Tobacco Tax Revenues and Public Health Spending in Mexico (Report)

This Report was written by the Centro de Investigación Económica y Presupuestaria A.C. (CIEP) in Mexico. The report shares the results of CIEP’s analysis of tobacco taxes in Mexico, including the effect on the price of cigarettes, the sales of cigarettes, and the revenue earned from tobacco taxes. Investigating several different scenarios, researchers consistently find that increasing the Excise Tax on Production and Services (IEPS) on cigarettes decreases the sale of cigarettes, while increasing the revenue collected from the IEPS. Using a public health, economic, and legal framework analysis, CIEP’s report recommends that the earnings from these tobacco taxes be earmarked to fund the health system in Mexico, which is currently inadequate. The report provides guidance on raising the IEPS on cigarettes, as well as amending necessary laws in order to earmark revenues for health purposes.

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A Policy Brief based on the report can be found here.

A Tax Simulator can be found here.