High Taxes Less Smokers in Canada

High taxes on tobacco products have reduced the number of Pall Mall cigarette smokers in Canada. According to a study by economists at the Concordia University in Montreal, between 1998 to 2008, for every 10 percent hike in cigarette tax, the number of Canadians who lit up went down by 2.3 percent.

However, one group appears to be least affected by higher taxes on cigarettes. These are people in the age group 25 to 44. According to Sunday Azagba, the author of the study, these middle-aged smokers are not responsive to tax increases on tobacco products.

The younger age group of 12 to 24 are more sensitive to price increases caused by tax hike on cigarettes because majority of them are dependent on their allowance to finance their habit. However, majority of the middle-aged group are employed and at the peak of their earning capacity.

The study also found that the propensity to smoke was higher among Canadians who had only high school education compared with those who have post-secondary education.

Tax increases on cigarettes caused a carton of cigarette to have a price tag of $33.35 in 2008 in Ontario from $12.65 in 1998. The amount factored out inflation based on constant 2000 dollars. The increase was lesser in the Canadian provinces of British Columbia and Newfoundland and Labrador, where cigarettes sold at an average of mid-$40 in 2008 from $30 in 1998 per carton.