The Public Health Benefits of Tobacco Tax Increases

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The Public Health Benefits of Tobacco Tax
Increases
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Public Health Benefits of Tobacco Tax Increases
Camden
Northampton
Gates
Currituck
Alleghany
Rockingham
Warren
Ashe
Surry
Caswell
Stokes
Pasquotank
Hertford
Vance
Person
Halifax
Perquimans
Wilkes
Mitchell
Watauga
Granville
Yadkin
Orange
Bertie
Chowan
Forsyth
Franklin
Guilford
Avery
Nash
Caldwell
Yancey
Durham
Alamance
Alexander
Davie
Washington
Madison
Edgecombe
Dare
Martin
Iredell
Tyrrell
Burke
Wake
Davidson
Wilson
Buncombe
Catawba
Chatham
McDowell
Randolph
Haywood
Rowan
Pitt
Beaufort
Swain
Hyde
Johnston
Lincoln
Greene
Rutherford
Graham
Lee
Henderson
Cabarrus
Jackson
Harnett
Moore
Gaston
Stanly
Lenoir
Wayne
Polk
Cherokee
Cleveland
Craven
Macon
Montgomery
Transylvania
Pamlico
Clay
Mecklenburg
Cumberland
Jones
Sampson
Richmond
Anson
Hoke
Union
Duplin
Carteret
Scotland
Onslow
Robeson
Bladen
Pender
New Hanover
Columbus
Brunswick
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2b2 By 2010, decrease the proportion of high
school students who smoke from 31.6 to 15.8
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2b1 By 2010, decrease the proportion of middle
school students who smoke from 15 to 7.5
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Costs of Tobacco Use

• Internalities

Externalities
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Product Cost per pack Cost per week
Cost per year Cost for 4 years
per pack a
day per pack a day per pack per day


(high school or

college)Marlboro 4.39
30.73 1602.35
6409.40Marlboro Lights 4.30
30.10 1569.50
6278.00Newports 4.14 28.98
1511.10 6044.40Camel 3.69
25.83 1346.85
5387.40 Camel Lights 3.69 25.83
1346.85 5387.40 Camel
Snus 3.99 27.93 1456.35
5825.40
Internalities What Could Kids Today Buy with
what tobacco addictions cost them?
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Costs of Smoking In NC

• 2.4 billion in direct medical care annually
• That equals 3.06 per pack sold!!
• 769 million in medical costs to NC Medicaid
  annually
• That equals 96 cents per pack!!
• This does not account for productivity losses,
  and suffering of families

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Cigarette Tax Rates(cents per pack)State
Average is 1.31 Per Pack
WASHINGTON 202.5
MONTANA 170
MAINE 200
NORTH DAKOTA 44
VT224
MINNESOTA 156
OREGON 118
VT
IDAHO 57
NH 178
NH
WISCONSIN 252
SOUTH DAKOTA 153
NEW YORK 275
MA
MA251
WYOMING 60
MICHIGAN 200
CT
RI346
CT200
IOWA 136
PENNSYLVANIA 135
NJ270
NEBRASKA 64
NEVADA 80
OHIO 125
DELAWARE160
UTAH 69.5
IN 99.5
ILLINOIS 98
WV 55
30 VIRGINIA
MARYLAND200
COLORADO 84
KANSAS 79
MISSOURI 17
DC200
87
KENTUCKY 60
CALIFORNIA
NORTH CAROLINA 35
TENNESSEE 62
OKLAHOMA 103
ARKANSAS 115
ARIZONA 200
NEW MEXICO 91
SOUTH CAROLINA 7
GEORGIA 37
ALABAMA 42.5
MS 68
TEXAS 141
36 LOUISIANA
ALASKA 200
HAWAII 260
FLORIDA 133.9
States that have not passed tax increases since
1999
States that have recently passed or implemented a
cigarette tax increase (since 1999)
July 2009
DEs increase to 1.60 per pack effective 8/1/09
WIs increase to 2.52 per pack effective 9/1/09.
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• Average State Cigarette Tax
• 1.31 per pack
• Average Cigarette Tax in Major Tobacco States
• 38.5 cents per pack
• Average Cigarette Tax in Non-Tobacco States
• 1.43 per pack

Campaign for Tobacco-Free Kids, July 2009
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• Tobacco Taxes and Tobacco Use
• Higher taxes
• induce quitting and prevent relapse,
• reduce consumption and
• prevent starting.
• Estimates from high-income countries indicate
  that 10 rise in price reduces overall cigarette
  consumption by about 4.

Source Chaloupka et al., 2000
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• Young People More Responsive to Price Increases
• Proportion of disposable income youth spends on
  cigarettes likely to exceed that for adults
• Peer influences much more important for young
  smokers than for
• adult smokers recent estimates indicate about
  1/3 of overall impact
• of price on youth accounted for by indirect
  impact through peers
• Young smokers less addicted than adult smokers
• Other spillover effects include the influence of
  parental smoking
• behaviors

Source Liang, et al., 2003 Chaloupka 2003
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Sources Chaloupka and Grossman, 1996 Tauras, et
al., 2001 Ross, et al., 2001
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North Carolinas Cigarette Tax Rate Increases
Have Raised State Revenues and Reduced Smoking
18.7 decline in annual cigarette pack sales
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North Carolinas Cigarette Tax Rate Increases
Have Raised State Revenues and Reduced Smoking
401.9 Increase in annual cigarette tax revenues
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If North Carolina raises cigarette tax by 1
per pack the percent decrease in youth
smoking 16.5
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If North Carolina raises cigarette tax by 1 per
pack the number of current adult smokers in NC
who would quit 58,900
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If North Carolina raises cigarette tax by 1 per
pack the total number of premature smoking
deaths avoided 43,300
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If North Carolina raises cigarette tax by 1 per
pack the long-term healthcare savings in state
from adult youth smoking declines
2,100,000,000.00
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In 2007 North Carolina General Assembly increased
the tax on non-cigarette products from 3 percent
to 10 percent of the wholesale price. The
current national average tax on non-cigarette
products is 34 percent of the wholesale price.
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Common Concerns Voiced in NC

• Myth Higher tobacco taxes and tobacco
  control generally will result in substantial
  job losses among tobacco farmers and workers.
• Truth Even in those states with the highest
  levels of tobacco farming and tobacco
  manufacturing, the economic consequences from
  the elimination of all U.S. smoking would be
  minimal and the increasing diversification
  of those states economies in recent
  years may have eliminated those net
  consequences altogether.
• Truth Money not spent on tobacco will be
  spent on other
• goods and services, creating
  alternative
• employment
• Sources Jacobs, et al., 2000

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Common Concerns Voiced in NC

• Regressivity?
• Myth Cigarette tax increases will negatively
  impact on the lowest income populations
• Truth Poor smokers bear disproportionate
  share of health consequences from smoking and are
  more responsive to price increases
• Negative impact can be offset by effectively
  using new tax revenues to support programs
  targeting lowest income population or protect
  funding for current programsthis is progressive

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Another Way to Say it

• Tobacco taxes arent regressive lung cancer is
  regressive COPD is regressive.

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Public Health Benefits of Tobacco Tax Increases
Camden
Northampton
Gates
Currituck
Alleghany
Rockingham
Warren
Ashe
Surry
Caswell
Stokes
Pasquotank
Hertford
Vance
Person
Halifax
Perquimans
Wilkes
Mitchell
Watauga
Granville
Yadkin
Orange
Bertie
Chowan
Forsyth
Franklin
Guilford
Avery
Nash
Caldwell
Yancey
Durham
Alamance
Alexander
Davie
Washington
Madison
Edgecombe
Dare
Martin
Iredell
Tyrrell
Burke
Wake
Davidson
Wilson
Buncombe
Catawba
Chatham
McDowell
Randolph
Haywood
Rowan
Pitt
Beaufort
Swain
Hyde
Johnston
Lincoln
Greene
Rutherford
Graham
Lee
Henderson
Cabarrus
Jackson
Harnett
Moore
Gaston
Stanly
Lenoir
Wayne
Polk
Cherokee
Cleveland
Craven
Macon
Montgomery
Transylvania
Pamlico
Clay
Mecklenburg
Cumberland
Jones
Sampson
Richmond
Anson
Hoke
Union
Duplin
Carteret
Scotland
Onslow
Robeson
Bladen
Pender
New Hanover
Columbus
Brunswick
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Conclusion

• Substantial increases in tobacco excise taxes
  lead to large reductions in tobacco use,
  especially among youth, which reduces the public
  health toll caused by tobacco use.
• For more information, see
• http//www/tobaccopreventionandcontrol.ncdhhs.gov
• http//www.impacteen.org
• http//www.tobaccofreekids.org

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Thank you!

• For more information, contact
• Jim D. Martin
• Jim.Martin_at_ncmail.net
• [phone]
• Sally H. Malek
• Sally.malek_at_ncmail.net
• [phone]
• www.tobaccopreventionandcontrol.ncdhhs.gov