Tobacco Giants’ Huge Profits Show Hypocrisy in Opposing Tobacco Tax Increases
May 23, 2014
Tobacco companies claim they have smokers' interests at heart when they oppose tobacco tax increases. But they are all too willing to exploit smokers for their own financial gains, as shown by a USA TODAY story this week.
USA TODAY reviewed companies in the Standard and Poor's 500 and found that three tobacco giants — Philip Morris International, Altria and Lorillard — are among the top 10 with the biggest profit margins, a measure of how much companies keep of every dollar in revenue after paying expenses. The three tobacco companies all have profit margins of over 40 percent.
USA TODAY describes these companies as those that 'are finding ways to extract the most profit from (consumers),' adding that 'smokers are definitely a source of smokin’-hot profit margins.'
Sadly, Big Tobacco's profits come at a high price for their customers. Smokers and other tobacco users pay with their wallets at the front end and with their health and lives at the back end.
Tobacco companies' high profits demonstrate their hypocrisy in fighting tobacco tax increases. The truth is they are just trying to protect and grow their own profits. When tobacco companies complain that higher taxes are unfair to smokers, the real unfairness comes from the companies themselves ripping off smokers — to gain exorbitant profits.
The industry's greed provides one more reason why governments should ignore the companies' self-serving arguments and approve significant increases in tobacco taxes.
The evidence is clear: Increasing the price of tobacco products is the most effective way to reduce smoking and other tobacco use, especially among vulnerable groups such as youth, pregnant women and low-income smokers. The evidence comes from throughout the United States and around the world. Even tobacco companies admit it in their own internal documents.
On May 31, the world’s nations will mark World No Tobacco Day, and this year the World Health Organization is using the occasion to call on countries to raise taxes on tobacco. There’s no better time for governments to enact significant tobacco tax increases that will save lives and help prevent the one billion deaths tobacco will otherwise cause this century.
Art courtesy of WHO