Let’s take some time and understand why we tax tobacco in the first place. Tobacco makes you sick. If you can’t afford something then you may not want to buy it. We tax tobacco so that it would not be affordable anymore. Since you can’t afford tobacco, you may no longer want to smoke it. As a result you don’t get sick anymore. A fine formula, right?
Smokers are price sensitive. The bulk of smokers are in the low to middle income countries. This means that poorer people tend to smoke more than affluent guys. Higher prices means that the government wants to keep the tobacco away from the reach of people that can barely afford health insurance. Society has to pay for health care for those who can’t afford it. That is why the extra taxes go to the expenses of people that have become sick due to smoking.
But the thing is that the money collected does not go to the funds for the sick, really. Some of the funds go to education, or public works. The funds simply don’t go to the sectors that has little or nothing to do with health care due to smoking.
Of course, no one, as in no one will admit this on record. The truth is that taxes on tobacco are an excellent way to get money from the people. It is one tax measure that people would not much grumble about. They are going to smoke even if the prices will go sky high. The government can always make the convenient excuse to say that they are increasing taxes and artificially increase the retail prices for the good of the health of the public and of course the smokers.
But, the government has been lying for decades. Tobacco companies are eager to make their products pricier if only they would be allowed to sell a dangerous, nay, deadly product. Hooked customers are happy because they can still legally get their addiction in a pack. Well, smokers are not exactly happy because, slowly, they are no longer able to afford their addiction and thus they fall prey to quit. Seriously, if only quitting is easy, the whole tobacco industry will go down in months.
Now, the same people that have been behind tobacco taxes are going after electronic cigarettes. Comparatively, tobacco and electronic cigarettes are light-years apart. There is no tobacco in electronic cigarettes. This means the devices are better and safer than tobacco. It is known to be a safe alternative to smoking. So why is government aiming its guns on the devices. They want to get taxes on the devices as tobacco sales plummet. They are no longer getting the same level of taxes as sales of tobacco goes down. The entry of electronic cigarettes hastened the quitting of smokers and thus injuring the bottom line. It seems as Big Tobacco shifts to electronic cigarettes, the taxes would follow suit. Then again, what would be the excuse of the government in taxing vapes, this time.