Impact of excise tax on consumption, brand loyalty and health awareness: Evidence from the United Arab Emirates

Figures & data

Table 1. Profile of the participants

Number of surveys delivered: 572
Total number of respondents: 559 (97%)
Demographics	Number of Participants	Percentage	Demographics	Number of Participants	Percentage
Age			Income per month
Below 20 years	99	18.0	No personal income (student)	170	30.1
Between 21-30 years	252	45.0	Less than AED 10,000	132	23.4
Between 31-40 years	114	20.0	Between AED 10,000 and 25,000	126	22.3
Between 41-50 years	66	11.8	Between AED 26,000 and 35,000	91	16.1
Did not mention age	28	5.0	Between AED 36,000 and 50,000	29	5.1
			Above AED 50,000	17	3.0
Gender			Sector
Male	184	32.9	Students	244	43.0
Female	375	67.1	Public	152	26.8
			Private	85	15.0
			Business	28	4.9
			Housewives	58	10.2
Emirate			Working experience
Sharjah	310	54.9	Not applicable	161	28.4
Dubai	103	18.2	(students/housewives)
Abu Dhabi	55	9.7	0-3 years	180	31.8
Fujairah	15	2.7	4-6 years	62	11.0
Ajman	45	8.0	7-10 years	54	9.5
Ras-ul-Khaimah	23	4.1	Over 10 years	109	19.3
Um-ul-Quwain	14	2.5
Marital Status
Married	345	61.1
Single	210	37.2
Separated	8	1.4
Widow	2	0.4

Table 2. Measures of survey reliability and factor analysis

Variables	Cronbach’s alpha	Cumulative explained variance (%)
Independent variable Excise Tax Information (ETI)
ETIA	0.62	34.42
ETIP	0.62	48.04
Dependent variable (1) Consumption of Excisable Products (CEP)
PC	0.64	100.00
FEP	0.64	29.41
UEP	0.64	57.29
PIC	0.64	78.90
Dependent variable (2) Brand Loyalty (BL)
PCB	0.71	63.87
SOB	0.71	85.04
RBL	0.71	100.00
Dependent variable (3)Health Awareness (HA)
IUH	0.74	57.61
IEPH	0.74	76.51
AEPH	0.74	92.71
FUE	0.74	100.00

Note: ETI = Excise tax implementation; ETIA = excise tax implementation awareness; ETIP = excise tax implementation and effect on price; CEP = consumption of excisable products; PC = product category; FEP = frequency of excisable products consumption; UEP = use of excisable products; PIC = price increase and consumption; BL = brand loyalty; PCB = price, consumption and brand loyalty; SOB = shift to other brands possibility; RBL = reasons of brand loyalty; HA = health awareness; IUH = information about unhealthy excisable products; IEPH = impact of excisable products on health; AEPH = awareness about excisable products and health; FUE = future use of excisable products; *Extraction method: principal component analysis using Varimax rotation.

Table 3. Descriptive statistics

Variables	N	Minimum	Maximum	Mean	Standard deviation
Independent variable Excise Tax Information (ETI)
ETIA	559	0	4	2.18	1.50
ETIP	559	0	1	0.85	0.35
Dependent variable (1) Consumption of Excisable Products (CEP)
PC	559	0	2	1.52	0.59
FEP	559	0	2	0.79	0.58
UEP	559	0	2	0.95	0.82
PIC	559	0	2	1.03	0.69
Dependent variable (2) Brand Loyalty (BL)
PCB	559	0	4	1.76	1.49
SOB	559	0	4	1.85	1.45
RBL	559	0	4	1.79	1.50
Dependent variable (3) Health Awareness (HA)
IUH	559	0	4	2.91	1.36
IEPH	559	0	4	2.86	1.38
AEPH	559	0	4	2.14	1.59
FUE	559	0	4	2.63	1.51
Demographics
GEN	559	1	2	1.67	0.47
AGE	559	0	3	1.28	0.90
MS	559	0	3	0.41	0.54
EMI	559	1	7	2.17	1.72
IG	559	0	5	1.52	1.35

All variables’ abbreviations are explained under Table 2.

Table 4. Correlation matrix

Correlation matrix
	ETIA	ETIP	PC	FEP	UEP	PIC	PCB	SOB	RBL	IUH	IEPH	AEPH	FUE	GEN	AGE	MS	EMI	INC
ETIA	1
ETIP	.106*	1
PC	0.071	0.028	1
FEP	.116*	−.136*	.126*	1
UEP	−0.057	−0.055	−0.047	−0.048	1
PIC	−0.007	−0.007	−.094*	−0.044	.197**	1
PCB	.306**	.154**	−0.005	0.067	0.070	−0.024	1
SOB	.227**	0.079	0.035	0.028	0.063	0.047	.431**	1
RBL	.240**	.097*	−0.056	0.025	0.034	−0.008	.391**	.548**	1
IUH	.205**	0.011	.167**	0.064	−.106*	−0.043	.087*	.136**	.115**	1
IEPH	.205**	−0.035	.158**	0.039	−.146**	−0.080	0.077	.186**	.147**	.705**	1
AEPH	.193**	0.008	0.061	0.013	−0.066	−.126**	0.061	.126**	.174**	.372**	.424**	1
FUE	.204**	.101*	0.058	0.044	−0.070	0.035	.136**	.168**	.182**	.333**	.379**	.343**	1
GEN	−.085*	0.005	0.070	0.105	−0.059	−0.034	−0.064	−0.011	0.036	0.038	0.058	0.015	0.057	1
Age	.102*	−0.025	0.015	−0.100	−0.061	0.049	0.022	−0.001	0.016	0.017	−0.007	0.012	−0.050	0.009	1
MS	.097*	−0.039	0.041	−0.049	0.018	−.100*	0.041	0.023	0.072	0.015	−0.002	0.068	−0.036	−0.014	.552**	1
EMI	0.006	−0.018	−0.001	−0.007	.119**	0.042	−0.018	−0.021	0.015	−0.073	−0.005	0.021	0.002	−0.009	−0.020	0.004	1
INC	.185**	0.042	−0.002	0.005	0.005	−0.019	0.074	0.077	0.081	−0.032	−0.022	−0.011	−0.046	−.190**	.534**	.494**	0.054	1

Note: All variables’ definitions are listed below Table 2. Pearson correlation coefficients (two-tailed) are provided. * and ** indicate significance at 5% and 1% level respectively.

Table 5. Regression analysis model (OLS)

Dependent variables properties
	Panel A				Panel B			Panel C
	PC	FEP	UEP	PIC	PCB	SOB	RBL	IUH	IEPH	AEPH	FUE
	1	2	3	4	5	6	7	8	9	10	11
ETIA	0.100 (2.198)	0.134(2.28)	−.066(−1.43)	−.020(−.434)	0.292(6.69)***	0.223(5.04)***	0.238(5.41)***	.209(4.71)***	.219(4.91)***	.201(4.53)***	.225(5.06)***
ETIP	.005(0.118)
GEN	.053(1.18)	.085 (1.44)	−.065(−1.45)	−.038(−.843)	−.030(−.682)	.010 (.232)	.056(1.289)	.029(.666)	.060(1.36)	.011(.257)	.077(1.74)
Age	−.051(−.861)	−.129 (−1.68)	−.107(−1.85)	.133(2.283)	−.038 (−.672)	−.079 (−1.364)	−.099(−1.735)	−.010(−.168)	−.003(−.057)	−.048(−.831)	−.034(−.587)
MS	.035(.621)	−.059 (−.802)	.057(1.03)	−.168(−3.02)	.019 (.360)	.022 (.403)	.078(1.433)	.032(.592)	−.008(−.142)	.131(2.382)	−.018(−.322)
EMI	−.005(−.118)	−.011 (−.190)	.107(2.41)	.035(.776)	−.041(−.945)	−.034 (−.766)	.009(0.201)	−1.77(.076)	.001(.014)	.028(.630)	.008(.175)
INC	.036(.641)	.109 (1.475)	.032(.590)	−.011(−.194)	.013(.244)	.068 (1.234)	.071(1.314)	−.054(−.980)	−.055(−.997)	−.079(−1.438)	−.062(−1.134)
Constant	1.35(10.39)***	0.597(4.17)***	1.093(6.80)***	1.07(7.89)***	1.17(11.06)***	1.46(5.04)***	1.01(3.38)***	2.61 (9.6)***	2.28(8.30)***	1.69(5.28)***	1.93(6.33)***
Radj.	0.001	0.021	0.015	0.014	0.078	0.046	0.059	0.038	0.038	0.039	0.046
D-W	1.76	2.08	2.05	2.07	1.92	1.96	2.13	1.93	1.89	2.07	1.83
F-Stat	1.08	2.04	2.54	2.39	8.05***	5.00***	6.28***	4.37***	4.31***	4.39***	4.99***
VIF (Mx/Mn)	1.03/1.00	1.02/1.00	1.03/1.03	1.03/1.03	1.03/1.00	1.03/1.00	1.03/1.00	1.03/1.00	1.03/1.00	1.03/1.00	1.03/1.00
Valid N	559	559	559	559	559	559	559	559	559	559	559

Note: All variables’ definition is listed below Table 2. Standardized beta coefficients are provided with t-values in parentheses. *, ** and *** indicate significance at 10%, 5% and 1% (two-tailed), respectively. Mx = maximum and Mn = number of observations.