Economics of tobacco use

Quick Facts

  • Taxation is an effective method of reducing tobacco consumption, especially among youth and low-income smokers.
  • The World Bank estimates that a 10% increase in the price of cigarettes worldwide would cause 40 million smokers to quit and prevent 10 million tobacco-related deaths.
  • In a 2005 public opinion survey, 64% of Albertans supported higher tobacco taxes as a means to prevent youth smoking.
  • In 2002, tobacco use was estimated to cost the Alberta economy $1.8 billion, which included $470.6 million in direct health-care costs.
  • The cost of tobacco use in Alberta due to loss of productivity in the workplace was estimated to be approximately $1.3 million in 2002.5
  • Fire damage due to smoking cost Albertans $46 million in property damage, and led to 40 deaths and over 280 injuries in 2003.
  • In Alberta, a pack-a-day smoker spends $3,984 on cigarettes each year, based on an average cost of $10.91 per pack.
  • In April 2007, Alberta’s cigarette tax was $37.00 per carton of 200 cigarettes, seventh highest among the provinces and territories.
  • In 2006, legislation was passed that allowed retailers to only sell tobacco marked for sale in Alberta. Tobacco intended for sale in other provinces cannot be sold in Alberta.

Source: Tobacco Basics Handbook Third Edition, 2008.  Alberta Health Services.

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