How You Can Help Hold Big Tobacco Accountable
Nearly 20 years ago, a U.S. Federal District judge found that the major cigarette manufacturers violated civil racketeering laws for deliberately defrauding the public.
News
Fact Sheet: Cigarette Tax Evasion
September 2, 2010
NEWS
from the American Cancer Society
For media inquiries, contact:
Paul McGee 716-689-6982 x103 (office) 716-523-6874 (cell)
[email protected]
For Immediate Release:
Fact Sheet: Cigarette Tax Evasion
Costs Keep Mounting for New York State in Dollars and Lives
Cigarette tax evasion costs New York State at least $800 million in excise tax revenue annually. New York City, which has a $1.50 cent per pack excise tax, loses at least $100 million more. Statewide, localities lose as much as $175 million in sales tax revenue. State and New York City taxes are not paid on an estimated one-third of cigarettes smoked in New York. Reservation sales are not the only source of untaxed cigarettes, but they are by far the largest.
Higher prices reduce cigarette consumption and save lives. Ending untaxed sales from reservations will encourage at least 100,000 adult smokers to quit, saving 25,000 lives1
Tobacco’s Impact on Health and Health Care Costs
Adult Smoking Rate, New York – 18% (2009 Behavioral Risk Factor Survey)
Number of Adult Smokers, New York – 2.6 million
Deaths caused by tobacco, New York 2006 – 25,400
New Yorkers alive with tobacco-caused illness – 570,000
Annual health care expenditures caused by tobacco, New York 2006 - $8.17 billion
Annual Medicaid expenditures caused by tobacco, New York 2006 - $5.4 billion
Annual tobacco-caused productivity losses from premature death, New York - $6.05 billion
Tobacco-caused health costs and productivity losses per pack of cigarettes sold - $21.91
Annual state and federal tax burden due to tobacco-caused expenditures - $900 per household
Teenage Smoking
High School students who smoke, New York 2008 – 13.8% (155,000)
Kids under 18 who became regular smokers, New York 2008- 21,000
Children ages 0 – 17 projected to die from smoking, New York – 331,000
How do we know a tax increase will lead to decreased consumption? A paper, (“Cigarette Demand: A Meta-Analysis of Elasticities,” by Craig A. Gallet and John A. List, published in the Journal Health Economics, V. 12, p.821-835) examined 523 published estimates of cigarette price elasticity from the academic literature. It found a median adult short-run price elasticity of 0.40 (long-run elasticity was 0.44). This means that for every 10 percent increase in price, there is a 4 percent decrease in consumption. About half the decreased consumption is due to adult smokers quitting, and half due to smokers who continue smoking at a reduced rate. We only present data on quitters.
###
About the American Cancer Society
The American Cancer Society combines an unyielding passion with nearly a century of experience to save lives and end suffering from cancer. As a global grassroots force of more than three million volunteers, we fight for every birthday threatened by every cancer in every community. We save lives by helping people stay well by preventing cancer or detecting it early; helping people get well by being there for them during and after a cancer diagnosis; by finding cures through investment in groundbreaking discovery; and by fighting back by rallying lawmakers to pass laws to defeat cancer and by rallying communities worldwide to join the fight. As the nation’s largest non-governmental investor in cancer research, contributing about $3.4 billion, we turn what we know about cancer into what we do. As a result, more than 11 million people in America who have had cancer and countless more who have avoided it will be celebrating birthdays this year. To learn more about us or to get help, call us anytime, day or night, at 1-800-227-2345 or visit cancer.org.
Related Updates
