It is estimated that half of Egyptian men smoke. This is one of the highest rates in the world. In recent years the Egyptian government has increased the tax on cigarettes. The government and central bank have also tried to reduce inflation and improve Egypt's international trade performance. The Egyptian government could use subsidies to reduce its deficit on the current account of its balance of payments. Explain two reasons why governments tax cigarettes.

Logical explanation which might include:
To raise revenue (1) demand for cigarettes is price-inelastic /
smoking is addictive / to spend on e.g. education (1).
To discourage consumption / to discourage production (1)
they are a demerit good / cigarettes are more harmful than
smokers realise / they cause health problems (1).
To reduce external costs / they create external costs (1)
impose a cost on third parties / cause pollution / health
problems for non-smokers (1).
To improve the current account position (1) cigarettes may be
imported (1).