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Originally posted by raj9721
270 million smokers in the U.S. (1998)
1.3 billion smokers in China (1998)
So lets say there are roughly 300 million smokers in the U.S. today, and a pack of cigarettes costs on average $6.00 ($9.75 where I live)
Current tax rate is $3.00 per pack
Lets say the average american smoker buys a pack every 3 days.
Thats $1.8 billion every 3 days, about $216 billion each year, half of which is government.
So $108 billion is government money, and that was using old statistics and being lenient.
Originally posted by eniac
reply to post by leisuredrummer
less nicotine means less addiction, means easier to quit, means less smokers, hopefully. So that's the link.
But maybe there is a conspiracy. Who knows.
If you're looking for a conspiracy, here's a possible one.
Demand for cigarettes is inelastic, on account of smokers are addicts (like me). This means that an increase in price typically returns a higher overall revenue. In other words, if you increase the price of an inelastic product, you only sell a few less, and make more money overall.
So increasing tax on cigarettes should make the Govt. more revenue from taxes.
And... you could argue that reducing nicotine will just make smokers buy more cigarettes, at the higher tax rate.
So you COULD argue that the whole thing is just a big money-making racket for the Government.