California’s $2-per-pack cigarette tax increase was followed by a steep drop in the number of households buying cigarettes. But the drop was smallest among the poorest households, and those low-income households that kept smoking ended up spending roughly twice as much on cigarettes five years later.
The study comes from Dian Gu, Hai-Yen Sung, Tingting Yao, Yingning Wang and Wendy Max of the University of California, San Francisco, and Courtney Keeler of the University of San Francisco. It was published online in Preventive Medicine Reports on December 22, 2025, for the journal’s January 2026 volume. An earlier version circulated as a University of California working paper in August 2025.
Following the same households for seven years
California voters approved Proposition 56, and the higher excise tax took effect on April 1, 2017. To see what happened next, the researchers used the NielsenIQ Consumer Panel, in which households record their weekly purchases of consumer products.
They followed a cohort of 2,324 California households that took part in the panel every year from 2016 through 2022. Households were sorted by income relative to the federal poverty level: low income (under 200%), middle income (200% to 399%) and high income (400% and above).
The team compared 2016, the year before the tax, with each year from 2018 to 2022, and with the average over those five years. They left 2017 out because the tax arrived partway through it. The models adjusted for household makeup, children, race and ethnicity, age, education, employment, marital status and urban or rural location.
Fewer buyers overall, but not among the poorest
In 2016, 10.6% of the California households bought cigarettes. That fell to 8.3% in 2018 and kept sliding to 4.2% in 2022, averaging 6.7% across the five follow-up years.
The decline was uneven. Over the five-year average, the share of cigarette-buying households dropped by 5.1 percentage points in the middle-income group and 3.8 points in the high-income group. In the low-income group it dropped by just 2.1 points, a significantly smaller change, and the low-income decline was not statistically significant in any single year until 2022.
Among households that kept buying, all income groups cut back on the number of packs in the first year. The low-income group went from 103.1 packs a year in 2016 to 68.2 packs in 2018, then rose above its starting level to 119.5 packs in 2021 and 147.5 packs in 2022, though those increases were not statistically significant.
A growing bill for low-income smokers
Spending tells the sharper story. Low-income households that kept buying cigarettes spent $651 a year on them in 2016, measured in 2022 dollars. That climbed to $1,053 in 2021 and $1,343 in 2022, both significant increases.
Those households spent 3.9% of their income on cigarettes in 2016, compared with 1.4% for middle-income and 0.2% for high-income buyers. By 2022 the low-income figure had reached 6.2%, although that change did not reach statistical significance.
The authors say the findings may challenge the common view that poorer smokers respond more strongly to price increases. They suggest targeted cessation programs for low-income smokers could ease the regressive burden of cigarette taxes.
They also list clear limits. The analysis is descriptive and cannot prove that Proposition 56 caused the changes. The follow-up period overlapped with the COVID-19 pandemic and with legal recreational cannabis sales in California, which began in January 2018. Households that dropped out of the panel were excluded, and scanner data can miss some cigarette purchases.
Even so, the numbers point to a specific group: for the low-income households that never quit, the tax-era cigarette bill rose to more than $1,300 a year by 2022.
Study Details:
- Title: Cigarette purchasing behaviors and financial burden of cigarette spending after a major tobacco tax increase in California: A descriptive analysis of household panel data
- Authors: Dian Gu, Hai-Yen Sung, Tingting Yao, Yingning Wang, Courtney Keeler, Wendy Max
- Journal: Preventive Medicine Reports
- Publication Date: December 22, 2025
- DOI: 10.1016/j.pmedr.2025.103352