USA TODAY Article on 2009 Federal Tobacco Tax Increase!
Wednesday, September 12, 2012
Posted by: Natalia Gromov
Below please find a link to the article published on the front page of USA TODAY on the effects of the 2009 federal tobacco tax increase. While the article focuses on the federal tax increase, the message is still relevant to states because it reiterates the basic benefits of a tax increase – a win for public health and a win for budgets.
Below is a link to a series of charts that contain more data related to the federal tobacco tax increase that you may find useful.
Fed tobacco tax story 9-11-12.pptx
headline in the actual paper is "Big tax increase reduces smoking”) http://www.usatoday.com/news/nation/story/2012-09-10/cigarette-tax-smoking/57737774/1
hike cuts tobacco consumption
Dennis Cauchon, USA TODAY
giant federal tobacco tax hike has spurred a historic drop in smoking,
especially among teens, poor people and those dependent on government health
insurance, a USA TODAY analysis finds.
Obama signed the tax hike — the biggest to take effect in his first term — on
his 16th day in office, reversing two vetoes by President Bush. The federal
cigarette tax jumped from 39 cents to $1.01 per pack on April 1, 2009, to
finance expanded health care for children. Since then, the change has brought
in more than $30 billion in new revenue, tax records show.
the tax hike and its repercussions remain mostly unknown to the non-smoking
public. The tax increase's size and national reach lifted prices 22% overnight,
more than all state and local tax hikes combined over the past decade when
adjusted for inflation.
The tax hike has helped restart a long-term decline in smoking that had stalled
in recent years. About 3 million fewer people smoked last year than in 2009,
despite a larger population, according to surveys by the Centers for Disease
Control and Prevention.
tax hits hardest on families who make less than $50,000 a year and account for
two-thirds of smokers.
federal tax increase was the win-win that we thought it would be and the
evidence shows that," says Danny McGoldrick, research vice president at
the Campaign for Tobacco-Free Kids.
smoking immediately fell 10% to 13% when the tax hike took effect, says
researcher Jidong Huang of the University of Chicago at Illinois. "High
prices deter kids from picking up cigarettes," he says.
taxes aren't the only reason smoking has fallen dramatically among adults since
the early 1980s and among teens since the mid-1990s.
concerns, smoke-free buildings and marketing restrictions have played a role.
Tobacco companies have raised their prices, too, making money off fewer
difficult to be specific about what influences individual adult consumer
behavior, but taxes are one thing in the mix," says David Sutton,
spokesman for Altria Group, maker of Marlboro cigarettes. He says taxes and
fees are so high — 55% of Marlboro's retail price — that they unfairly burden
adults who choose to smoke.
are the sledge hammer of anti-smoking efforts. The federal tax hike helped push
tobacco use down to 18.9% in 2011, the lowest level on record, according to the
CDC surveys. Even smokers who don't quit light up less. In the 1990s, one of
every 20 high school students smoked 10 or more cigarettes a day. Today, one
out of 71 students smoke that much.
quit. The elderly and Hispanics slashed smoking most dramatically, each down
more than 15% from 2008 to 2011, according to the CDC's National Health
Interview Survey. Women quit more than men. Least moved: middle-age men, down
care for poor. About 1 million adults on Medicaid quit smoking, which could
reduce future health costs.
industry. Consumer spending on tobacco rose from $80 billion in 2008 to $98
billion in 2011 in inflation-adjusted dollars — even though the amount of
tobacco purchased fell 11% , Bureau of Economic Analysis data show. Higher
taxes accounted for about half that spending increase. The rest went to tobacco
companies and retailers.