Cigarette price increase The article is about the minimum price of cigarettes of RM7 for a pack of 20 cigarettes is not a new measure and has been in place since January 2010. More than half of the minors (53%) said they buy their own cigarettes, while 30% got them from friends in Malaysia, 55% of the adolescent smokers smoke less than 10 sticks per day in Kelantan, 95% of shops sold cigarettes to minors without verifying their age. There are over 80,000 retail outlets selling cigarettes throughout the country and are located near schools. About 31% of teenage boys and 5.3% of girls are smokers. Australia and Singapore have high tobacco tax and successfully reduced smoking among adolescents as a pack of cigarettes costs A$15 (RM38) and …show more content…
Government should make the inspection on them in anytime without informing those so the seller dare not to sell the cigarette to teenager that are below 18 years old. This may make the supply of the cigarette on teenager below 18 decreases and the supply curve will to the left in this situation. There are no other substitute goods for cigarette as smokers only will buy cigarette as they couldn’t find other thing that able substitute the cigarette. Weed is too heavy to substitute the cigarette so it cannot substitute the cigarette and shisha also couldn’t substitute the cigarette as people who like to smoke shisha doesn’t mean that they must be a smoker and the smokers doesn’t mean that they like to smoke shisha. Besides that, some people are addicted on shisha only but some are only addicted on cigarette. Most of the people will only be addicted to either shisha or cigarette but not both so there are very few substitute goods for cigarette so in this situation, the demand for cigarette is perfect inelastic. Tobacco taxes increases smokers still demand on it. The cigarette company are able to earn more as the taxes of tobacco increases but people still demand for it. The increase of the taxes will not affect the quantity of people demand for the cigarette. Besides that, the daily cost of the smoker will increase as the price of cigarettes increase but they still buy it. I think this will cause the
In the article it explain how raising taxes on cigarettes will benefits teens in the future: “Studies indicate that 90 percent of smokers start as teens. An estimated 17,000 California kids get hooked on smoking and one-third of them will eventually die from a tobacco-related illness. In every other state that has raised the tobacco tax, smoking rates have gone down among teens” (Western Dental Joins California Health Leaders Supporting Proposition 56). Most people would agree that habits are formed at young age, and we all know that bad habits are hard to quit, specially those that creates addiction such as cigarettes. If the price of cigarettes is raise, teens will not be able to afford them since teens are limited in money which will prevent them from creating that addiction. Also, we will be able to have more control over impulsive teenagers, is not that we are coddling them but rather guide them to do what is right for them and break the cycle of smokers. Furthermore,
In the year of 2010, the Federal Government raised taxes on cigarettes by an extra 25 per cent, resulting in an increase price of $2.16 to every pack of 30 cigarettes. A proclamation stated by Prime Minister Kevin Rudd on the crackdown on Internet advertising of cigarettes was mentioned. Mr. Rudd also affirmed ‘the government will spend $27.8 million on an anti-smoking campaign (Hall, 2010)
In the article ‘Cigarette tax hike sparks panic buying’, Hall (2010) discusses the effects of tax increase on cigarettes. The government has decided to raise the tax on cigarettes by 25%, costing $2.16 more on a pack of 30 cigarettes. This government intervention is an attempt to stop people from smoking and reduce the health bill caused by those who smoke. The increase in tax is expected to save $5 billion more of the people’s tax dollars and the government decided that it will be put into a better use for its health and hospitals reparations. This contractionary fiscal policy is expected to reduce the total tobacco consumption by approximately six percent and drive down the number of smokers by 87,000.
In today 's world, people are very one-sided on the issues of smoking. There are many types of things that you can smoke but marijuana and cigarettes seem to be the most controversial. Countless amounts of people are against smoking in general, smoking cigarettes, and/or smoking marijuana. Because of the certain setbacks and outlooks on these smoking impacts, the economy adjusts with consumers and non-consumers of both substances. The economy is mainly determined on the types of consumer behavior and responses towards certain laws and events that go on in the world, including smoking cigarettes and marijuana. The government also plays a role in this use because it officially made cigarettes legal for adults and also gave each state the
The impact of the tax is an increase in the cost of every pack of cigarette a consumer buys. Since smokers view cigarettes as necessities as their addiction to nicotine worsens, the demand curve is relatively steep. When demand curves are steep, the consumer is burdened with paying most of the tax. Therefore, the price of cigarettes will rise greatly if the excise tax is passed. The party that cannot respond to the change are the ones that pay the tax. There are no substitutes for cigarettes, especially considering that this tax includes all forms tobacco and electronic cigarettes. Part of the reason this tax is on the ballot is to increase revenue, and the increase in revenue will be used “to replace old revenue lost due to lower tobacco consumption
Every year, the world spend billions of dollars for smokers. Tobacco is the main cause of many serious diseases such as lung cancer, throat cancer, and lip cancer. With the current tax policy, there are still many objects can have access to the drug. Therefore, I agree with the idea to raise taxes for cigarettes and cigars.
One of the commonly used drugs in the world is Tobacco, primarily in the form of cigarettes, with more than a billion adult smoke tobacco daily. The health care costs are high for smokers themselves, and also the society who is bearing both health care cost and lost productivity. Some believes that government plays an important role to regulate citizens from the negative effects of smoking, while others believe the decision is personal. In my opinion, government has all the rights to control tobacco use and set laws for the citizens to follow.
A strategy that will directly affect the supply of cigarettes is raising the taxes on businesses that sale cigarettes. If the taxes are raised on businesses that sell cigarettes, then many businesses will stop selling cigarettes to avoid paying higher taxes. If many businesses stop selling cigarettes then it will be harder for smokers to get cigarettes. This will also causes the businesses that still decide to sell cigarettes to have higher prices on the cigarettes causing smokers to not buy them.
As stated before there is the fact that taxes are higher on cigarettes in non-producing states then producing states. The difference can be up to a whole dollar. There is also the example of Kentucky and how they are one of the highest producers in tobacco and have one of the highest averages in the country for teenage smokers. The final important reason is that politicians are being paid by tobacco industries to raise the taxes and the politicians are accepting that money to get elected and then to raise the tax. This then creates more money for their state and for the tobacco industry. There are many ways to look at the situation that the United States faces. But it doesn’t change the fact that tobacco-producing states are more likely to have a higher percentage of teenage
There are many cities who have implemented bans on cigarettes, but China overall is still the leading consumer of cigarettes in the world. A countrywide tax on cigarettes has been proposed to their Ministry of Finance, and Ministry of Economics and Trade, but a decision has yet to be made. Tobacco production provides substantial revenue to the government and a tax increase will have a significant effect on the central government and reduction of consumption of cigarettes. According to a study done by the group proposing the tax, “a 25% tax increase will have an overall monetary benefit that far exceeds the negative impact on the cigarette industry and tobacco farmers. In financial terms alone, not counting the number of lives saved and medical care cost savings, the gain of the central government tax revenue (24.58 billion Yuan) twice exceeds the loss of tobacco farmers’ earnings, tobacco industry workers’ earning and loss of industry and local government revenue (11.74 billion Yuan)” (Hu TW 107). There many components to this calculation, but some factors included the reduction of cigarette consumption, the number of lives saved, savings in medical care costs, gains in productivity due to avoidance of premature death, industry revenue lost, lost jobs in cigarette industry, loss of tobacco income, and loss of local government
In recent years, smoking rates have declined due to the implementation of Student Assistance Program (SAP) in Washington State. SAP is helping students with the mental health problem and tobacco addiction treatment. The cigarettes smoking rates among teenagers are at a record low. But the overall teen smoking rates remain unchanged. Because the E-cigarettes, hookah and other tobacco products have been largely used by the teenagers. According to the report of Centers for Disease Control (CDC), high school and middle school students have tried to use a flavored tobacco product for their first time. And it will also make teenagers begin to use cigarettes.
The nicotine in tobacco is not only causing a variety of diseases but also leading a highly addictive (Hammond, 2009.). Secondly, the solution for the tobacco industry, they could do the appropriate measures such as add health warnings on tobacco packages, health warnings on tobacco packages increase smokers’ awareness of their risk (WHO, 2008, p. 34). But unfortunately, the tobacco industry would not be willing to do it unless the policy requires them to do so. However, the relevant policies in many developed countries are lacking. So if the national laws and regulations force the tobacco industry to do it then the solution would be more effective. Thirdly, the solutions for government, the government should ban on tobacco advertising and raise tobacco taxes. WHO (2008, p. 37) states that if the government ban on tobacco advertising that the tobacco sales will have up to 16% decrease. In addition, increase tobacco taxes could raise the price of tobacco. According to WHO (2008, p. 39) that “increasing the price of tobacco through higher taxes is the single most effective way to decrease consumption and encourage tobacco users to quit”. In conclusion, the smoking problem will be solved by joint efforts of the whole community.
Conclusion: Both cigarette prices can keep away smokers from smoking as it can be an operative tool in regulating smoking.
Inelastic demand is if there is a change in the price of a product it leads to a proportionally smaller change in the quantity demanded for it. This mean that tax alone is not very effective in reducing quantity demanded. If the taxes would be raised too much, people would start to look at other alternative ways of getting cigarettes (black market). Cigarettes have price inelastic demand because of their addictive properties, therefore an increase in price has only made a minimal change in quantity demanded (Q2 to Q1). For regular consumers this is a burden since the price has increased, but consumers still highly demand this commodity even at a higher price because of its inelasticity. Furthermore, a new market equilibrium was formed (E1 to E2) due to the change in price and the shift in the supply curve, which producers are forced to follow. Generally, price inelastic commodities are primary targets for high rate taxation during times of economic crisis, as a lot of tax revenue is
A larger population, other things being equal, will mean a higher demand for cigarettes. Changes in the way the population is structured also influences demand. Many Eastern countries have a growing population and this leads to a change in the demand as there are more young adults in China (for example).Thus demand of cigarettes might increase