> Ciagarette companies "lowered" their prices to pennies, and the government came in and pretty much taxed the difference between cost price and sale price. So that cigarette now costs under a penny to make, but the government steals 2$ a cig The Federal government - both political parties - did that to make cigarettes less affordable, hoping to get people to quit. When they saw a slight dip in revenue collection they did it again, to make up the 'shortfall' on the backs of people who were too addicted to quit.