$100 a Pack

I don’t smoke and I can’t stand the smell of tobacco smoke in any form, so I suppose I should be thrilled at this story  from NBC News that I found on Drudge.

New Zealand’s Health Ministry has reportedly considered boosting the price of a pack of cigarettes as high as $100 ($81 U.S.) in a bid to make the country smoke free by 2025.

An internal government working paper raised the possibility of upping the cost of a 20-cigarette pack by 30 to 60 percent and tacking on yearly increases of 30 percent, Sky News reported.

With cigarettes now priced at about $16 to $17, New Zealand Prime Minister John Key said the $100 suggestion seemed like “an awful lot” and could encourage a black market, Fairfax NZ News reported.

Anti-tobacco activist Ben Youdan said it would be more “realistic” to price smokes at “$30 to $40 a pack” over the course of 10 to 15 years as part of a comprehensive campaign to reduce the number of smokers in the country, now around 650,000, according to Fairfax NZ News.

The problem is that while such a policy would certainly reduce the number of smokers in New Zealand, it would also create a black market of untaxed cigarettes. I imagine that if the costs of trying to crack down on illicit cigarettes are considered the savings in health costs created by the reduction in the number of smokers wouldn’t be all that much.

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