Cigarette Policy Costs Military $1 Billion

Selling discount cigarettes to members of the military encourages smoking and costs the Pentagon nearly $1 billion a year in tobacco-related health and work expenses, according to an internal report.

The draft report by the Department of Defense inspector general urges the military to go beyond a recent cigarette price hike at commissaries and raise prices to the full market rate.

Defense Department “retail system pricing policies for tobacco products encourage high sales and are inconsistent with goals for a healthy active-duty force,” concludes the report, obtained Monday by The Associated Press.

A Pentagon policy that took effect at the beginning of the month raised cigarette prices by $4 per carton at the military’s 230 commissaries nationwide. But the increase still leaves cigarette prices well below market rates.

Under the new policy, for example, a carton of generic cigarettes sold at the Fort Lewis, Wash., commissary would increase to $8.89. However, that’s still less than half the lowest price - $19.99 - the inspector general could find in the commercial retail market in that area.