Governments heavily tax tobacco with the hope of lowering the associated health costs (and tax money is always juicy). But almost all the time it backfires and these happen: -People just keep smoking -It creates an economical burden in house holds with smokers because of the prices and difficulty of quitting -Smuggling or bad quality tobacco consumption increases.

So, like most things government does, intervention with good intentions creates more problems. IMO, government should not interfere with it, and smokers should not get cheap health insurance (or none from government).