The New York City Council adopted the 'Tobacco 21' bill 35 to 10 to raise the legal age to buy tobacco, including cigarettes, electronic cigarettes, cigars and cigarillos to 21 from 18 in an effort to "save lives".
The new law would come into effect six months after its signing by the Mayor.
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New York City Mayor Michael Bloomberg welcomed the move saying increasing the smoking age to 21 would help "prevent another generation from the ill health and shorter life expectancy that comes with smoking.
"Between 2001 and 2011, New York city cut the proportion of public high school students who smoke by more than half. However, the decline in youth smoking in our city has stalled", he said.
"We know that tobacco dependence can begin very soon after a young person first tries smoking so it's critical that we stop young people from smoking before they ever start," Bloomberg said.
The city's Health Commissioner Thomas Farley said more than 80 per cent of adult smokers in the city start smoking before age 21, so raising the sales age to 21 will protect teens and may help prevent others from ever starting to smoke.
In addition to passing the 'Tobacco 21' bill, the council also approved a 'Sensible Tobacco Enforcement' bill which would prohibit discounts on tobacco products and increase enforcement on vendors who attempt to evade taxes.
"The Sensible Tobacco Enforcement law will prohibit discounting and crack down on illegal untaxed cigarette sales, both of which attract young people to smoking.
These two laws will protect our young people from the marketing of tobacco and represent historic advances in our fight against New York City's leading killer," Farley said.
Despite New York City's success in reducing tobacco use over the last decade, the youth smoking rate has remained flat at 8.5% since 2007.
According to estimates provided by the city, establishing a tobacco purchase age of 21 could reduce the smoking rate among 18-20 year olds by 55%, and reduce the smoking rate among 14-17 year olds by two-thirds.
The authorities said smoking is the number one cause of preventable disease and death in the US.
Almost 5,00,000 lives are lost in the country each year from tobacco-related illnesses and disease, which includes 25,000 New Yorkers.
It costs the US a staggering $200 billion dollars in healthcare and lost productivity annually, with New York recording losses of $14 billion.
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