The Tobacco Industry and Taxation

The Tobacco Industry and Taxation - One industry that has...

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The Tobacco Industry and Taxation 1 The Tobacco Industry and Taxation Economic Theory ECO/205
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The Tobacco Industry and Taxation 2 One industry that has been making a lot of money off consumers over the years is the tobacco industry. There have been various taxes placed on tobacco products hoping to decrease the amount of the people that smoke. Throughout the years, numerous campaigns have come and gone to get smokers to stop smoking, but the heavy taxes that the government place on the tobacco products is the one biggest reason that smokers quit smoking. Is taxing the tobacco products going to be enough to make the tobacco industry go under? Most of the nation has show that they are in favor of the higher prices on the tobacco products, but the higher prices is not hurting the sellers more than it is the buyers. Cigarette sales have both a state and a federal tax imposed on the product. The sellers attempt to shove as much of the cost onto the consumer as they can so that hey can make the most amount of money possible (Equilibrium, 2006). Consumers are still purchasing tobacco products, so they do not have any other choice but to pay the price that the sellers have placed on the products. There has not been a strong enough substitute for these products, and there are no alternatives available to nicotine, which is a drug. There are many producers of tobacco
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This note was uploaded on 04/19/2010 for the course N/A ECO/205 taught by Professor N/a during the Summer '09 term at University of Phoenix.

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The Tobacco Industry and Taxation - One industry that has...

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