Smoke break gets more expensive with tax boost
Associated Press | 4/1/2009, 5:24 a.m.
WASHINGTON — However they satisfy their nicotine cravings, tobacco users are facing a big hit now that the single largest federal tobacco tax increase ever has gone into effect.Tobacco companies and public health advocates, longtime foes in the nicotine battles, are trying to turn the situation to their advantage. The major cigarette makers raised prices a couple of weeks ago, partly to offset any prospective drop in profits after the per-pack tax climbed Wednesday from 39 cents to $1.01.
Medical groups see a tax increase right in the middle of a recession as a great incentive to help persuade smokers to quit.
Tobacco taxes are soaring to finance a major expansion of health insurance for children. President Barack Obama signed that health initiative soon after taking office.
Other tobacco products, from cigars to pipes and smokeless, are seeing similarly large tax increases, too. For example, the tax on chewing tobacco has increased from 19.5 cents per pound to 50 cents. The total expected to be raised over the four-and-a-half-year-long health insurance expansion is nearly $33 billion.
Smokers are mulling their options.
Standing outside an office building in downtown Washington, 29-year-old Sam Sarkhosh puffed on a Marlboro Light. His 8-year-old daughter has been pleading with him to quit, he explained, and he has set a goal to give up smoking by his 30th birthday.
“I’m trying to quit smoking, and it could help,” said Sarkhosh, an information systems specialist. “I don’t think it will stop me from buying cigarettes every now and then, but definitely not as often.” A friend who smokes Camels went out and bought four cartons in advance, he said.
The tax increase is only the first move in a recharged anti-smoking campaign. Congress also is considering legislation to empower the Food and Drug Administration to regulate tobacco. That could lead to reformulated cigarettes. Obama, who has agonized over his own cigarette habit, said he would sign such a bill.
Prospects for reducing the harm from smoking are better than they have been in years, said Dr. Timothy Gardner, president of the American Heart Association. The tax increase “is a terrific public health move by the federal government,” he said.
“Every time that the tax on tobacco goes up, the use of cigarettes goes down,” he added.
About one in five adults in the United States smokes cigarettes. That’s a gradually dwindling share, though it isn’t shrinking fast enough for public health advocates.
The Centers for Disease Control and Prevention says cigarette smoking results in an estimated 443,000 premature deaths each year, and costs the economy $193 billion in health care expenses and lost time from work. Smoking is a major contributor to heart disease, cancer and lung disease.
Public health officials are urging individual doctors and staff at telephone “quit lines” in every state to make the most of the tax increase by reaching out to smokers. But it’s unclear how deeply the tax will cut into tobacco consumption.