Tax
Taxation is the single most effective and cost-efficient intervention to reduce tobacco consumption, especially amongst younger generations and low income groups. The World Health Organization) in its Framework Convention for Tobacco Control (WHO-FCTC) Article 6 emphasises taxation as a major tool in pursuing tobacco demand reduction.
The raising of tobacco tax translates into increase in the price of tobacco products and consequently decreased demand for tobacco, especially among groups, with lesser purchasing powers, increased cessation rates among current users and less likelihood of quitters resuming tobacco use.
The youth are particularly sensitive to price rises and may reduce their smoking at two to three times the rate of adults. For instance, in 2002 New York City launched its Tobacco Control Program which included raising tobacco taxation. This program reported a decrease of smoking rates among teenagers from 17.6% in 2001 to 8.5% over a period of five years
Given the price inelasticity of tobacco products, increased taxation is a win-win situation for governments and public health adherents alike. Governments are able to raise more revenue from tobacco products because, the addiction of tobacco will maintain a critical mass of users, whose payment surpass the deficit caused by reduction of use or cessation among the low income populations. Reduction of use is in turn, a gain in public health as, less people will suffer the consequences of tobacco use. Further, the additional revenue from higher tobacco taxes could be allocated to social programs such as affordable and accessible health services, health insurance and smoking cessation programs. Quitting tobacco lowers itself reduces health costs and creates opportunities to use the resources, otherwise spent on tobacco, on food and other essential needs.