View Full Version : Whats the true cost of a pack of cigarettes?
01-19-2003, 09:21 PM
Cigarette prices in my area are around $3.50 per pack of Marlboroughs. I have to wonder how much of that $3.50 is taxes and fees.
I remember cigarettes back in the '70s were about 75 cents a pack. This was before they started taxing the hell out of them. I also remember buying cartons of generic cigarettes for $4.10 back when I was in the military during the 1980s. Of course, at that time, cigs were tax and duty free at the military commissary.
So I have to wonder what is the true cost of a pack of smokes. I'm talking about how much money it takes to produce one pack of marlboroughs. Probably between 50 and 75 cents, I would think. Does anyone have any good guesses?
01-19-2003, 09:30 PM
- - - In the late 80's when I worked at a convenience store and when cigarettes had just gone to $1.50 a pack, a cigarette rep told us the actual cost was 18 cents.
01-20-2003, 10:45 AM
"Cigarettes are relatively cheap to manufacture, they can cost
about $0.05/each ... Shipping Questions ** QUESTION: Where is my package?! ...
However, that website is down, that quote appears from a search engine list.
At SFO I saw a duty free shop that had Marlboro Reds for $17.95 a carton in 2000.
01-20-2003, 12:05 PM
I think you mean the "wholesale" cost of cigarettes.
The "true" cost of cigarettes, as I understand it, would be a different thread and might include other factors such as loss of productivity, increased health care costs, loss of enjoyment of particpation in some physical activities, but also a reduction in Social Security costs caused by shortened life.
Or maybe there's no consensus on what "true" cost means.
01-20-2003, 12:29 PM
I would say it's less than $.05 a cigarette, because that would make it $1 a pack.
A month ago, I saw duty free Marlboros in Bangkok airport (also in Rio, for that matter) for $11 a carton. So, I'd guess DougC is closer to the truth at 18 cents a pack.
01-20-2003, 01:04 PM
The question is not production costs, but what is a "fair market price" without taxes -- remember that the manufacturer, the wholesaler, and the retailer have to make their overheads and profits, unless you want to drive to a factory outlet store every time you want to buy a pack.
North Carolina's per-pack tax is $0.05, and the Federal excise tax is $0.39. A 6.5% state sales tax is added to the price-before-excise-tax. Typically one can pick up a pack of Marlboros around here for about $3.00 -- ranging from $2.80 to $3.50 depending on the store and whether any specials are being held. When our funds are a bit low, we tend to smoke Kingstons, an off brand manufactured in a small town in Virginia, which cost $1.39 a pack or $14.00 a carton -- the lowest regular price we've seen (and, by the way, a better tasting cigarette for a Marlboro-by-preference smoker than most generic brands).
R. J. Reynolds has a web page discussing excise taxes and their impact on the tobacco industry. This page gives thirteen states' excise taxes per pack.
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