The revenue collected by the Government from tobacco sales has increased by 53 per cent over the past decade, new figures show.
Some €727 million was collected in excise duties on tobacco products by the Government in 1997 and this increased to €1.1 million in 2006.
The figures, which have been provided to the Fine Gael TD Dr Leo Varadkar in reply to a parliamentary question, also show cigarette sales have fallen by just 10 per cent over the same period.
Dr Varadkar said yesterday it was clear from the figures that the amount of tax imposed on tobacco products by the Government was not having the desired effect of a "sin tax" which was to get people to quit smoking in large numbers.
"As you increase it, rather than bringing in more revenue, it should cause people to smoke less," he said. He added that higher taxes should be placed on cigarettes to protect people's health.
"The Government will say they would like to do it but to do so they would have to take tobacco out of the consumer price index and the unions would not agree to this," he said.
"I think the position of the unions is disgraceful if they are prepared to put the health and lives of Irish people behind wage claims," he added.
John McCormack, chief executive of the Irish Cancer Society, said there hadn't been sustained and significantly large increases in taxes on cigarettes to drive down consumption, particularly at a time when it was known the disposable income of young people was increasing.
The price of a packet of 20 cigarettes was increased by 30 cent in the recent budget, an increase condemned at the time as inadequate, not just by the Irish Cancer Society but also by the anti-smoking lobby group Ash Ireland and the Irish Heart Foundation. They had sought a €2 increase on packs of 20 cigarettes.
Mr McCormack said the Government's argument was if it increased tax on cigarettes it would drive up inflation figures used in wage negotiations.
The only way forward, he suggested, was to remove cigarettes from the consumer price index and then sharp increases could be imposed on the price of tobacco products without it affecting inflation figures.
"We would urge the Government to commence work with the social partners on finding a formula to break the link between increasing the tax on cigarettes and the flow through to inflation figures that are used for wage negotiations," he said.
In a Dáil debate following the Budget, the Taoiseach Bertie Ahern said that if the social partners agreed to cigarettes being taken out of the consumer price index, their prices could be increased significantly but at present "it's just not a runner".
He said the 30 cent increase in the price of tobacco in the Budget would raise the consumer price index by 0.2 per cent, and result in a 1 per cent reduction in smoking. He also insisted cigarette consumption was falling despite the increase in the Irish population.
When the issue of removing tobacco from the index was discussed after the previous budget, the unions opposed the move. The general secretary of the State's largest trade union, Jack O'Connor, said at the time: "The index is compiled to reflect the cost of living across society. There is no basis for a change like that. That will not see the light of day."
Dr Varadkar said the Government should just do the right thing and remove tobacco from the consumer price index, regardless of the position of the unions, as it would improve people's health and save lives.