PRICE – How Affordable Tobacco Products are for the Consumer

Discounts and coupons

According to the Surgeon General, raising the price of tobacco products is one of the most effective strategies for preventing young people from starting, reducing the amount of tobacco used, and increasing the number of people who quit. We’re proud that New York State has the highest cigarette tax in the nation at $4.35 per pack. The state tobacctobaccoOnSaleo tax is a huge contributor to the steadily decreasing smoking rates since it went into effect.

The tobacco industry understands the relationship between price and consumption so it has developed creative strategies including coupons and multipack discounts to undermine the positive impact of tobacco taxes. Coupons directly reduce the price of a product at the point of sale while a multipack discount is a promotional tool that includes the sale of multiple packages or products for one price such as a buy one, get one free offer.

Package size

Cigars2

The Food and Drug  Administration requires cigarettes to be sold in pack sizes of no less than twenty which keeps the price per pack reasonably high. Other tobacco products (also known as OTPs) are not included in this regulation, leaving products such as cigars, cigarillos, smokeless tobacco, and loose Cigars1tobacco to be sold at cheaper and more tempting prices such as the Swisher Sweets in the photo above priced at 2 for 99¢ and the Show Cigarillos pictured to the right at 5 for $1

The results are predictable; while cigarette use is going down among high schools students, OTP use remains high as illustrated in the graph below.

 

Youth_use_stat_shot

Solutions

Fortunately, there are additional steps states and local communities can take to prevent tobacco companies from undoing all the positive benefits of cigarette excise taxes, including:

  • Implementing or strengthening minimum price laws
  • Banning price discounting/multipack offers
  • Increasing tobacco retail licensing fees
  • Requiring a minimum package size for all tobacco products

For more information on these strategies and how to implement them locally: