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Significant Cigarette Tax Increases Generate New Revenue

April 3, 2023

Significant tobacco tax increases are one of the most effective ways to prevent kids from starting to use tobacco and help adults quit.[i],[ii] Substantial increases in cigarette tax rates also generate new revenue. In fact, every state that has significantly increased its cigarette tax has also boosted its state revenue - even after accounting for revenue loss due to beneficial declines in cigarette purchases resulting from the tax increase.

 

[i] U.S. National Cancer Institute and World Health Organization. The Economics of Tobacco and Tobacco Control. National Cancer Institute Tobacco Control Monograph 21. NIH Publication No. 16-CA-8029A. Bethesda, MD: U.S. Department of Health and Human Services, National Institutes of Health, National Cancer Institute; and Geneva, CH: World Health Organization; 2016.

[ii] HHS, 2014.