Chapter 26 Tobacco and the military

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Tobacco and the military: Military store pricing issues

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Prices of tobacco products in military commissaries (grocery stores) were raised on

November 1, 1996 to equal prices in exchanges (retail stores). In some cases, this

meant a one-third increase, while the average increase was 18%. Military

commissaries have $458 million in yearly sales of tobacco products.

Air Force Times, September 2, 1996, p. 12

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The tobacco industry is campaigning on Capitol Hill to block a Pentagon plan to raise

the price of discounted cigarettes sold in scores of military grocery stores around the

world. The military sells $458 million of cigarettes and chewing tobacco a year in

government-subsidized commissaries, at 30 percent to 60 percent less than prices in

commercial grocery stores. Commissaries sell 58 million cartons of cigarettes a

year. Government budget analysts estimate the plan could cut tobacco sales at

commissaries in half and cost tobacco companies as much as $200 million a year in

sales. Under the Pentagon's plan, which is scheduled to take effect on Nov. 1, the

government would end its subsidy of commissary tobacco products in an effort to

discourage tobacco consumption... A Defense Department report estimated that

tobacco use by military personnel costs the agency more than $900 million a year in

medical expenses and lost productivity. But at the urging of the tobacco industry's

powerful lobby, a panel of the House National Security committee in a letter signed by

all 12 members, has demanded that the Pentagon cancel the price increase... 70

percent of the tobacco products are being bought by retirees. Diseases attributed to

tobacco use accounted for about 16 percent of the deaths in the military last year,

according to the inspector general's report.

Quote from San Francisco Examiner, October 20, 1996 (Eric Schmitt, New York

Times)

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Thursday, July 06, 2000

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