Background There is evidence that the cheapest cigarettes cost even less in neighbourhoods with higher proportions of youth, racial/ethnic minorities and low-income residents. This study examined the relationship between the price of the cheapest cigarette pack and neighbourhood demographics in a representative sample of tobacco retailers in the USA.

Methods Data collectors recorded the price of the cheapest cigarette pack (regardless of brand) in 2069 retailers in 2015. Multilevel linear modelling examined the relationship between price and store neighbourhood (census tract) characteristics, specifically median household income and percentage of youth, Black, Asian/Pacific Islander and Hispanic residents.

Results Average price for the cheapest pack was $5.17 (SD=1.73) and it was discounted in 19.7% of stores. The price was $0.04 less for each SD increase in the percentage of youth and $0.22 less in neighbourhoods with the lowest as compared with the highest median household incomes. Excluding excise taxes, the average price was $2.48 (SD=0.85), and associations with neighbourhood demographics were similar.

Conclusion The cheapest cigarettes cost significantly less in neighbourhoods with a greater percentage of youth and lower median household income. Non-tax mechanisms to increase price, such as minimum price laws and restrictions on discounts/coupons, may increase cheap cigarette prices.