QuitSA - The cost of smoking

In addition to the human cost of loss of life and health, smoking has many serious social, economic and environmental costs to societies and families.

Personal Costs

Smoking is a very expensive habit. In 2003–04, Australian smokers spent more than $10 billion on a product that most of them wish they could stop using. ¹ That’s $10 billion that could have been spent on other goods and services that would have been better for their families.

Are you a smoker? Have you ever wondered how much you spend on smoking? Try our Cost Calculator.

Costs to Society

In 2002, a report estimated the cost of tobacco use in Australia as $21.06 billion.³ These costs included:

	loss of production or lost earnings due to illness and death,
	health care costs,
	loss of consumption due to illness and death.

Some costs are more difficult to quantify and may not be included. These include:

	passive smoking costs,
	welfare costs,
	absenteeism,
	ambulance services,
	property costs of accidental fires.
	pain and suffering of the sick and those around them.

The study estimated the gross costs in Australia of treating major diseases attributable to smoking to be around $2.25 billion.

Results from a recent study published in the Medical Journal of Australia predict a one percent drop in smoking prevalence could save about $20.4 million in health care costs.⁴

Government spending on tobacco control

In 2001, the VicHealth Centre for Tobacco Control produced a document entitled Tobacco Control: A Blue Chip investment in public health. This document recommends a per capita funding level of $10.00 for tobacco control.⁵

Currently, the Government spends $3.9m a year on tobacco control. The Commonwealth recently announced two new programs amounting to $7.1m a year over four years for tobacco control initiatives. Commonwealth funding at $1 per capita would amount to $20m per year. By almost any measure, tobacco control is under funded.

It is estimated $2 has been saved on health care for each $1 spent on tobacco control programs to date. Total economic benefits of Government spending on Tobacco Control in the last 30 years must have exceeded expenditure by at least 50 to 1. ¹

Tobacco Consumption, Expenditure, Prices, Production and Taxes

The Commonwealth Government shares responsibility for health with the states and territories, and collects all tobacco tax and excise (approximately $5.6 billion pa).

The VicHealth Centre for Tobacco Control (VCTC) provides up-to-date information on cigarette taxes, retail tobacco prices, market share and consumption. VCTC also provides other economic data such as tobacco imports, economic costs of tobacco in Australia, etc.

VicHealth Centre for Tobacco Control

Social and environmental costs

Evidence shows that smoking is an effect of and a contributor to social inequality. “The greatest burden of illness and costs due to tobacco occurs among households in the lowest quintile of social advantage: smoking is most devastating for those who can least afford it”. ¹
There is also a serious environmental cost to smoking. See Tobacco and the Environment for more information.

References
1 National Tobacco Strategy 2004-2009
2 Collins DJ & Lapsley HM 1996. The social costs of drug abuse in Australia in 1988 and 1992. Canberra: Commonwealth Department of Human Services and Health (National Drug Strategy Monograph Series No 30).
3 Collins DJ & Lapsley HM 2002. Counting the cost: estimates of the social costs of drug abuse in Australia 1998-9. Canberra: Commonwealth Department of Health and Ageing.
4 Hurley SF (2005) Short-term impact of smoking cessation on myocardial infarction and stroke hospitalisations and costs in Australia. MJA 2005; 183 (1): 13-17.
5 Tobacco Control: A Blue Chip Investment
6 Golden Leaf, Barren Harvest: The Costs of Tobacco Farming