Heated Tobacco Products Use in Montenegro [Working Paper Series]

This Working Paper was written by the Institute for Socio-Economic Analysis in Montenegro. The working paper assesses the market for heated tobacco products (HTP) and the current regulatory environment for these products. Between 2019 and 2023, smoking prevalence of HTPs increased significantly, from 0.2% to 3.9%, respectively. These smokers of HTPs tend to be female, young, live in urban areas, and report higher household incomes. The researchers find that prices of HTPs have not increased proportionally to tax increases, with only EUR 0.26 passed through to consumers for every EUR 1 tax increase per pack. This pricing of HTPs aligns closely with the pricing used for middle- to lower-range premium cigarettes to establish HTPs as a competitive alternative to cigarettes. At the same time, lower taxes on HTPs increases profits for manufacturers, while decreasing government revenues. Specifically, in 2023, EUR 5.2 million of potential tax revenue was lost as a result of these pricing strategies. The working paper concludes with recommendations for decision makers to strengthen tobacco control efforts by adjusting policies to discourage use of HTPs. 

A Policy Brief based on this working paper can be found here.