Final answer:
Tax incidence is the analysis of how a tax burden is divided between consumers and producers. The division of burden is determined by the elasticity of demand and supply. In the case of cigarette taxes, the tax burden falls on the most inelastic side of the market, which is the consumers.
Step-by-step explanation:
The analysis of how a tax burden is divided between consumers and producers is called tax incidence. In general equilibrium incidence, the tax burden falls both on the consumers and producers of the taxed good. However, the group that bears the most burden can be predicted by examining the elasticity of demand and supply. In the case of cigarette taxes, the tax burden falls on the most inelastic side of the market, which is the consumers.