“Studies show that as the cost of cigarettes goes up, smoking rates go down, especially among our kids,” said Torlakson. “This tax hike will save lives by preventing addiction and save tax payers billions of dollars currently going to treat tobacco-related medical conditions.”
On February 4, 2009, the Children's Health Insurance Program Reauthorization Act of 2009 was signed into law, which increases the Federal excise tax on all tobacco products. The measure, which calls for a 62-cents-a-pack increase, will go into effect on April 1st, bringing the total federal tobacco excise tax to $1.01 for a pack of cigarettes. Money from the tax — $32.8 billion — will go to the State Children's Health Insurance Program, known as SCHIP, to extend health care coverage to 4 million uninsured children.
A study by the U.S. Bureau of Labor Statistics show that when cigarette prices go up, youth smoking rates go down. For example, in the late 1990s and early 2000s when prices increased, youth smoking rates declined significantly, and when the price went down between 2003 and 2005, youth smoking rates increased. The correlation was demonstrated yet again in 2005-2007 when the cost of cigarettes was slightly increased and youth smoking rates dipped once more. In fact, studies show that for every 10 percent increase in price, youth smoking rates decline by 7 percent and about 4 percent overall.
Forty-four states and the District of Columbia have increased their cigarette taxes since 2002, while California’s levels haven’t changed from $0.87 since 1998. Torlakson’s measure could raise approximately $2 billion annually for education, children’s healthcare, and tobacco-related disease, research, and cessation programs by raising the tobacco tax by $2.10 per pack. |
