Benefit Cost Analysis for Tobacco Product Packaging

To reduce the health and economic burden of tobacco use, the Government of Canada considered plain and standardized packaging requirements for tobacco products, i.e., generic packaging with no logos or branding elements. IEc is evaluating the costs, benefits, and economic impacts of these requirements.

Drawing on extensive outreach with packaging suppliers, cigarette manufacturers, retail associations, and other actors, IEc is developing a detailed analysis of industry compliance costs. The analysis considers the cost of redesigning package artwork and retooling printing equipment as well as the cost of new cigarette packing equipment needed to produce cigarettes of a standard size. The analysis also monetizes potential delays in product retrieval at tobacco retail establishments, and evaluates whether plain packaging could prompt consumers to switch to less profitable discount brands.

IEc’s report will also summarize the literature on the effect that tobacco product packaging has on consumer perceptions of smoking health risks. We are using the literature to assess the potential for plain packaging to  reduce the attractiveness of tobacco product packaging (especially to young people); increase the salience of warning labels; reduce misconceptions about product harm and strength; and alter attitudes, beliefs, intentions, and behavior related to tobacco use.