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$15 MINIMUM PRICE <br />ON CIGARETTES AND SMOKELESS TOBACCO <br />The tobacco industry knows that cheap prices attract new customers and keep current <br />customers coming back for more. The industry spends around 70-80% of their annual <br />marketing and advertising budget on price discounts for consumers.¹ <br />Raising the price of commercial <br />tobacco products is one of the <br />most effective strategies for <br />decreasing use, helping people <br />quit, and preventing youth from <br />starting to use commercial <br />tobacco. <br />Increasing excise taxes has long been the <br />primary way to raise tobacco prices, but many <br />local jurisdictions do not have the authority to <br />enact additional tax increases, and coupons and <br />discounts undermine the impact of such taxes.² <br />Additional pricing policies can complement excise tax increases and counteract industry <br />practices that keep prices low.² Minimum pricing is one piece of the puzzle. <br />Strong commercial tobacco pricing policies are made up of three parts: <br />Set a minimum price <br />for tobacco products <br />Set a minimum <br />pack size <br />Prohibit redemption of <br />coupons, discounts and <br />price promotions <br />When cigarette prices rise, people tend to smoke less or quit.³ <br />For every 10%increase in the price of cigarettes, <br />adult smoking decreases by 3-5% <br />and youth smoking decreases by 6-7%⁴ <br />Minimum prices should be set high enough to discourage youth and others who have <br />never used tobacco or nicotine from starting and to encourage people who currently use <br />commercial tobacco to reduce their use or quit.⁵ <br />38