Sinceboth price and tax increases have widened the price differential between cigarettes and fine-cut tobacco. This occurred as a result of the Union's increasing debt during the American Civil War and the Federal government's need for additional revenue.
Also by eliminating the price differential between military and nonmilitary retail outlets, the incentive for illegal smuggling of tobacco products out of military bases would be eliminated.
Studies estimate that approximately two-thirds of the decreased consumption is the result of people choosing not to smoke at all.
Some taxes can have undesirable effects; for example, income taxes might discourage working, and investment taxes might discourage savings. Their data estimates that taxes make up The Canadian experience in raising tobacco taxes during the s provides useful data for comparing the price sensitivity of teenagers and adults.
Increasing tobacco taxes can: Keep kids from starting to smoke Help adults to quit Provide funding for much-needed health programs Increasing Cigarette and Tobacco Product Taxes Increasing taxes on cigarettes is a win-win proposition: significantly increasing cigarette taxes results in fewer kids starting to smoke, and in more adults quitting while at the same time providing substantial revenue to fund important health, as well as tobacco prevention programs.
Moreover, revenues generated through higher tobacco taxes could be earmarked for health care for the indigent, thus offsetting the regressivity of tobacco taxes.
With few exceptions, the imposition of, and increases in, state tobacco taxes are the result of the need to raise revenues. The combination of lower cigarette taxes and a higher standard of living that is, more money to spend on goods makes cigarettes much more affordable for Americans than for persons in nearly all other industrialized countries.
Data from the Consumer Expenditure Survey were used to relate expenditures for tobacco products with income. In many jurisdictions in the U.