I'll have to search for the study, but I'm fairly certain that cigarettes are a net positive effect on the health budget. They die significantly earlier than the majority, which is beneficial when those 65+ are amongst the heaviest users of the health care system.
I hate that the government thinks it can ad-hoc punish companies for providing services that are seeked out by consumers. a) It's not the companies fault that people began or continue to smoke, b) The government should not be in the business of condoning or penalizing personal decisions that don't harm others. Now some people will complain that their tax dollars are paying for someone else's smoking, but that's what you get in socialized medicine, and I doubt very seriously that many Canadians want to see that end.