No Ifs, No Butts

The littering of non-biodegradable items severely impacts the iconographic landscapes of British communities, exposes the environment to toxins which harms wildlife and pollutes water supplies, and imposes a £682m clean-up cost to the taxpayer. The Department for Environment, Food and Rural Affairs estimated that cigarette butts were the most frequently littered item with 1202 tonnes littered annually, prevalent in 73 per cent of streets and are the most collected item during beach clean-ups. Indeed, “more needs to be done to tackle smoking-related litter” (Priestley, 2017). Non-biodegradable cigarette butts take a long time to disappear (7.5-14 years) and contain carcinogenic chemicals and heavy metals – the properties which make smoking a harmful activity to engage in – and thus represents a significant environmental threat. Cigarette filters prevent these toxic chemicals from being inhaled by the smoker meaning that smokers will be at a far greater health risk if they were removed (Novotny et al., 2009). 

Cigarette butt littering is a result of market failure. In contrast to other environmental problems, property rights in towns and other recreational areas in the UK are well-defined and have been allocated via strict and reputable legal institutions. Councils have well-established fines for cigarette littering, enforced by a mixture of court action, increased fines, and convictions if unpaid. However, the increasing cigarette litter clearly demonstrate that these policies are insufficient. These property rights cannot sufficiently be enforced because of the large area of land that needs to be covered and the incredibly small probability of catching a litterer in the act. The financial penalty for cigarette littering is just a paper tiger.

These contradictions undermine the effectiveness of property rights in constraining the littering of cigarette butts and mean that there is a significant dissonance between the polluter and their actions. This is especially relevant because cigarette butts are incredibly light and can runoff a long way in a short period of time. The price the polluter pays for their cigarettes does not reflect their damage to the environment or the cost of clean-up.

A Pigovian tax can solve this problem (Pigou, 2001). A Pigovian tax rectifies negative externalities by incorporating the social cost of consumption/production into the good’s market price. In this case, a tax can be imposed on non-biodegradable cigarette filters to increase their market price and reduce their consumption to a socially optimal level. This would solve the problem in two principal ways: lessen the number of non-biodegradable filters in circulation and incentivise the consumption of biodegradable filters, which take a far less time to decompose, and alternative smoking methods which do not involve filters, such as e-cigarettes.

The implementation of the tax might be hindered in the short-run due to information problems. If asymmetric, or even absent information, is present when setting the level of tax, such as quantifying the environmental damage of cigarette butts, then the tax might be set too high or too low to achieve the socially optimal level of consumption. In such a circumstance, the market will be in disequilibrium as the tax will be set too high or low to achieve the socially optimal level. However, the level of tax can be corrected at the very least by trial-and-error and incorporation of newer information in the long-run.

The success of that tax is further challenged by its reliant on other institutions: contraband and black market cigarettes become more price-competitive if the price of cigarettes increases, undermining the effectiveness of domestic Pigovian taxes (Foxe, 2017).

However, cigarettes are already heavily taxed – 16.5% of the retail price plus £4.34 per packet of 20 – due to health reasons. In tandem with its addictive nature, implying that the demand for cigarettes is price inelastic, potentially nullifies the Pigovian tax’s ability to reduce the consumption of cigarettes. Indeed, many believe that taxes do not challenge the underlying behavioural attitudes which drive the littering in the first place – distance to butt receptacles are the biggest factor – thus will not be effective in reducing cigarette butt littering (Schneider et al., 2011). Furthermore, there is a potential of a ‘rebound effect’; the tax may induce a behavioural response – the belief that they have paid for the right to litter – and thus may not reduce the amount of cigarette butt litter as intended.

However, an environmental tax on cigarettes will act as an information signal to consumers by highlighting the environmental damage that cigarette littering causes. Thus, the tax may normalise, or increase, a negative perception towards cigarette littering, and denormalise the “everyone does it” attitude (Wagner, 2014). Moreover, the tax will make biodegradable cigarette filters more price-competitive, so even if behavioural influences do not result in reduced demand, the environmental damage will be far less than the status quo scenario. Additionally, the tax will act as a ‘double dividend’ for the government: revenues gained can be ring-fenced to be re-invested in increasing the coverage and access to recycling bins, mitigating against such behavioural actions. Plus, councils will not have to spend as much on cleaning-up cigarette butts providing a further economic benefit. The criticisms of the tax may limit its effectiveness but do not nullify it. Indeed, the tax provides a platform for, and potentially the financing of, long-term educational and advertising programs that promote social responsibility and the dangers of cigarette littering.

The littering of cigarette butts poses a momentous environmental threat to biodiversity and water quality, notwithstanding its aesthetic implications and financial cost of clean-up. The status quo policy of financial penalties is not credible, and thus do not prevent cigarette butt littering. Whilst the tax is not a silver bullet solution, it can be used in conjunction with long-term educational programs to reduce the amount of cigarette butt litter. Indeed, the criticisms levied at the tax limit its effectiveness but do not negate from pursuing it. With 4.5 trillion cigarette butts littered annually, this is a global problem. If the taxation is implemented and proves to be successful, it can be replicated and utilised by other countries to combat this problem. No ifs, no butts.

About the Author:

Benjamin Burman is a Master's student of Sustainable Development and Environmental Economics, with a passion and interest for politics, economics and journalism. 

Bibliography

Foxe, K. (2017). Tobacco Tax Rise Driving Smokers to Black Market. The Times. [online] Available at: https://www.thetimes.co.uk/article/tobacco-tax-rise-driving-smokers-to-black-market-vcmkzjp0q [Accessed 3 Apr. 2018].

Novotny, T., Lum, K., Smith, E., Wang, V. and Barnes, R. (2009) ‘Cigarettes Butts and the Case for an Environmental Policy on Hazardous Cigarette Waste’. International Journal of Environmental Research and Public Health, 6(5), pp.1691-1705.

Pigou, A. (2001). The Economics of Welfare. New York: Routledge.

Priestley, S. (2017). Litter. London: House of Commons Library.

Schneider, J., Peterson, N., Kiss, N., Ebeid, O. and Doyle, A. (2011) ‘Tobacco Litter Costs and Public Policy: A Framework and Methodology for Considering the use of Fees to Offset Abatement Costs’. Tobacco Control, 20(1), pp.36-41.

Wagner, V. (2014). Littering and Following the Crowd. The Atlantic. [online] Available at: https://www.theatlantic.com/health/archive/2014/08/littering-and-following-the-crowd/374913/ [Accessed 3 Apr. 2018].