Since the signing of the MSA in November 1998, some 40 other tobacco companies have signed the agreement and are bound by its terms. Under the “qualifying law,” non-signatory tobacco companies (also known as “non-participating producers” or “NPMs”) must pay a portion of their income into a trust account.   The money in the receiver account serves as a reserve of responsibility.   If the NPMs are successfully sued for damage to cigarettes, the money in the trust accounts will pay the damages.   The payment of each NPM is based on market share and is approximately the cost per cigarette, such as the amount that OPMs must pay to comply with the MSA. Payments can only be used to pay a judgment or transaction on a claim against NPM, up to the amount that the NPM would otherwise pay under the MSA. All remaining funds in the trust account return to the NPM after 25 years. Second, Becker and Murphy stated that, given the addictive nature of cigarettes, the demand for cigarettes by smokers after the price increase would be plausibly less reactive.12 Becker and Murphy argued that in response to an increase in the cigarette tax, tobacco companies would increase the price more than the increase in taxes in order to obtain maximum gain for already addicted smokers. Given the oligopolistic structure of the sector, national industry-wide comparisons, such as MSA, may result in increased profits in the sector.8,13 The AMS makes payments to tobacco companies a function of the number of cigarette packets sold by tobacco companies. In this sense, the MSA`s payment structure is similar to that of excise duties. With this market structure, companies are moving excise duties to consumers as best they can.

14-17 While increased excise duties may result in higher gains for tobacco companies in the short term, profits may decline in the long run, higher prices deter young people from creating habit18 or high-end producers lose market share. As is often the case, governments have spent this money for purposes other than what was intended. Since the adoption of the MSA, states have turned to the constant flow of their tobacco wave to do almost anything they want.