China Is Hopelessly Tied at the Hip to Cigarettes, as Tobacco Sales Continue to Increase

In most of the world’s technologically developed superpowers, it has been a long time since tobacco wielded what one might call universal social or economic clout. Smoking was once completely socially normalized as recently as the mid-1960s, when federal tracking of smoking rates in the U.S. began. At that time, more than 42% of all U.S. adults were active cigarette smokers. Today, the number in the U.S. is less than 10% and still in sharp decline, with the remainder mostly being older citizens who have been smoking for decades–merely 3.4% of young U.S. adults ages 18-24 are now cigarette users, although it bears noting that some have progressed on to smoking or vaping substitutes such as cannabis. Still, it’s not hard to imagine that the United States and some of its closest global allies are moving steadily toward a tobacco-free future, thanks to decades of effective health messaging, education, taxation and stigmatization. But China, on the other hand? China is what happens when a global superpower becomes so tied at the hip to the revenue created by smoking that the true addiction is to the way a drug like tobacco props up the federal bottom line.

Consider this statistic from a new New York Times piece on China’s physical and economic reliance on tobacco, which stopped me dead in my tracks: The state monopoly that controls the entire tobacco industry and its primary cigarette maker, the China National Tobacco Corporation, generated approximately $244 billion in profit and tax revenue in 2025. That’s not gross revenue; it’s profit and tax revenue flowing straight to the federal coffers. This figure is equal to a shocking 7% of the total national government revenue, and is nearly equal to the stated figure of what China says it spends on its entire national defense budget. Or to put it succinctly, tobacco effectively pays for the entire Chinese military in a nation of 1.4 billion souls. That is a lot of fucking cigarettes! So many, in fact, that the 2.4 trillion total cigarettes sold in China each year represent roughly half of the entire global total. Frankly, I had no idea that any nation on Earth was smoking like this in 2026.

These numbers aren’t just static, either: They’re still actively rising even as the world at large increasingly swears off conventional tobacco products such as cigarettes. Overall cigarette consumption in China rose 39% in the period between 2003-2023, while overall cigarette consumption fell 26% during the same period in the entire rest of the world. If there’s one positive, it’s that the overall prevalence of smoking, aka the percentage of people in Chinese society who are smokers, has actually fallen somewhat, driven by lower cigarette adoption among younger people. But the rest of Chinese society has seemingly just made up for them by smoking that much more.

Many many many men smoke in China. A small but outspoken group of women are becoming anti-smoking advocates, confronting those who light up in public. n.pr/4f0lLgq

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— NPR (@npr.org) 4:27 PM · May 21, 2026

Why is this the case? Well, it certainly helps that the barrier to entry for getting ahold of cigarettes in China remains much lower than in many comparable industrialized economic powerhouses that have gone out of their way to put barriers and social warnings in place against cigarette consumption. Health warnings on cigarette packages are much smaller and less severe in China than they are elsewhere. Taxes on cigarettes are likewise much lower than in the United States, keeping the absolute prices of each pack to the consumer far lower–but despite that, nearly half of the revenue from every cigarette sold ends up going directly to government budgets. This is even more extreme in specific, tobacco-producing regions–according to NYT, a city like Kunming, the capital of Yunnan Province, has half of its entire city budget provided by tobacco taxes. When tobacco is that critically important to the functioning and funding of everyday life, do you expect that city to enact many local ordinances that regulate where one can smoke?

The Chinese tobacco industry capitalizes on this opportunity to embed itself into the economic and governmental structure by funneling funding into critical parts of the Chinese infrastructure, aligning its contributions with the priorities of leader Xi Jinping. It props up the state-run banking system, and invests heavily in the national semiconductor investment fund that powers the AI industry. Tobacco simply makes itself indispensable to the running of the nation … and it can obviously no longer keep the flow of funding coming if the Chinese people start meaningfully reducing their consumption of cigarettes and tobacco products.

This leaves the government’s health agencies and initiatives in an awkward place where they must both acknowledge the grave harms and sky-high health costs that cigarette use obviously contributes to, and dance around the economic imperative of not messing with tobacco profits. Tobacco lobbyists spring into action to water down any attempt at restricting where smoking can occur, even in seemingly common-sense locales such as schools. Local regulations are put into place, but no one bothers with enforcement. A long-sought national indoor smoking ban was finally defeated in 2017, with the central Chinese government returning responsibility to local governments, themselves also dependent upon tobacco tax revenues. Even the national regulations that do get adopted are frequently undercut and are ultimately rendered toothless.

This is IMO one of the most important charts of the past 20 years. The rise of cigarette sales paired with the rate of lung cancer deaths.

Smoking cessation saves lives. If you have a friend who still smokes cigarettes, show them this chart.

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— emigal.bsky.social (@emigal.bsky.social) 2:37 PM · Dec 5, 2024

When current leader Xi Jinping gradually solidified his power over the Chinese government in 2012-2013, it was initially seen as cause for celebration by anti-smoking activists and health crusaders. Xi is himself a former smoker who quit years earlier, and it was hoped that this personal perspective would translate to greater empathy/support for health-focused regulation in one of the world’s absolute largest countries by population, where smoking is estimated to contribute to more than 2.5 million preventable deaths per year. In these early days of his leadership, anti-smoking health crusaders such as Bill Gates even made public appearances at anti-smoking events with Xi’s wife Peng Liyuan, and it seemed as if the country might reevaluate the lack of social stigma it assigns to tobacco as a drug. Whatever aspirations may have been there, however, seemingly cooled by the mid-2010s amid the general slowdown and ossification of the broader Chinese economy, which made the steadiness of tobacco profits more important than they’d ever been before. Suffice to say, the likes of Xi and Peng Liyuan no longer make proclamations related to smoking at all, increasingly leaving the national smoking opposition as groups of younger Chinese citizens without the massive resources or megaphone to be widely heard.

The smell of tobacco, of wafting cigarette smoke, remains more or less inescapable, especially in the wide stretches of rural China where much of it is grown. How do you convince a government to cede a key portion of its own revenue by disincentivizing the very product that is killing its population? Some addictions are just too fundamental to have much hope of breaking them.