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You don't seem to understand that this has nothing to do with the actual payment of taxes. Businesses don't pay for the tax on cigarettes, it is passed directly
by hervature 5y ago
You don't seem to understand that this has nothing to do with the actual payment of taxes. Businesses don't pay for the tax on cigarettes, it is passed directly to the consumer. The elasticity of demand can be such that the consumer just incurs $1,000 higher costs. So the $1,000 in payments don't provide you a benefit, it merely allows you to live the same life.
- bryanlarsen 5y agoThe average consumer has $1000 higher costs and a $1000 cheque. You're right, it's a wash. But 80% of consumers are below average. The average is skewed by people with private jets, et cetera. Personally, I'm probably above median and below average.