Washington, D.C. – March 8, 2010 – New Mexico and Utah took major steps forward to save lives and protect children when both of the states’ legislatures voted to increase their tobacco taxes. New Mexico passed a 75-cent tobacco tax increase late in the evening on March 4 and sent it to Governor Bill Richardson’s desk for his signature – pushing the state cigarette tax to $1.66 per pack. The Utah legislature passed a $1.005 increase March 5 bringing the state’s cigarette tax to $1.70. Both state taxes are now well above the current national average of $1.34 per pack.
The governors from both states are expected to sign the measures into law in the coming days and both will go into effect July 1, 2010.
“These important public health victories will save lives in New Mexico and Utah,” said John R. Seffrin, PhD, CEO, American Cancer Society Cancer Action Network (ACS CAN). “Raising tobacco taxes protects public health by reducing smoking and helps to boost the economy by generating revenue and long-term health savings. We encourage more states to follow New Mexico and Utah’s lead.”
ACS CAN, the advocacy affiliate of the American Cancer Society, championed the tobacco tax increases in New Mexico and Utah to prompt current smokers to quit and prevent youth from starting. Currently in New Mexico, an estimated 279,000 adults and 22,000 youth smoke. In Utah, it is estimated that 172,000 adults and 11,000 children smoke. Research has consistently shown that every 10 percent increase in the price of cigarettes reduces youth smoking by 7 percent and overall cigarette consumption by about 4 percent.
Every year, New Mexico incurs more than $461 million in direct medical costs and $467 million in productivity costs from smoking. The increased tax will generate approximately $33 million in revenue for the state in the first year. The revenue from the tax increase will be directed to education, early childhood education, Medicaid and numerous other health services.
In Utah, the legislature also made the important steps of passing a 51 percent increase on other tobacco products and a $1.08 per ounce increase in the moist snuff tax. Projected revenue from the combined increases is over $43 million for 2011 and nearly $45 million for subsequent years. The money will be directed to the general fund and will restore prenatal care for low income expectant mothers, cuts in highway patrol troopers and other important programs.
ACS CAN and the Society are currently working on campaigns to increase tobacco taxes in many states across the country. Since 2002, 46 states, the District of Columbia and several U.S. territories have raised their cigarette tax in 97 separate instances, including 14 states and the District of Columbia in 2009 alone. Once the increases in New Mexico and Utah go into effect, the average state cigarette tax will be $1.38 per pack, with taxes ranging from a low of seven cents in South Carolina to a high of $3.46 in Rhode Island. New Mexico and Utah are the first states to significantly increase their tobacco taxes in 2010.
“During these cash-strapped times, we encourage lawmakers to consider a tobacco tax increase as a viable means for shrinking budget shortfalls and generating revenue for critical health programs in the states,” said Molly A. Daniels, interim president of ACS CAN. “At the same time, tobacco taxes are one of the most effective ways to sharply reduce smoking, thereby reducing necessary health spending and lowering the cancer burden in a state. It’s a win for states every way you look at it.”
According to a recent report released by ACS CAN in partnership with other leading public health organizations, if all 50 states increased their cigarette taxes by $1 per pack, they would collectively raise more than $9 billion in new annual revenue to help close severe budget shortfalls, while also reducing smoking and saving lives.
The report, Tobacco Taxes: A Win-Win-Win for Cash-Strapped States, also provides evidence demonstrating that every state that has raised its cigarette tax rate significantly has generated dramatic new revenue despite the declines in smoking that occur as a result of the price increase.
Data also shows that states can achieve even greater financial and health benefits if they also increase tax rates on other tobacco products, such as smokeless tobacco and cigars, and dedicate some of their tobacco tax revenues to fund programs to prevent kids from smoking and help smokers quit.
In addition to tobacco tax increases, ACS CAN and the Society are committed to working community by community and state by state until every worker in America is protected from secondhand smoke under a comprehensive smoke-free law.
Currently, 19 states have laws prohibiting smoking in all non-hospitality workplaces, bars and restaurants. An additional three states, Wisconsin, Michigan and South Dakota, have passed such laws and are awaiting implementation. Last week, Kansas lawmakers sent a comprehensive smoke-free law to the Governor’s desk for signature. If the bill is signed into law, Kansas will be the 4th state awaiting implementation of a comprehensive smoke-free law in 2010.
The use of tobacco products remains the nation’s number one cause of preventable death, killing more than 400,000 Americans and costing $96 billion in health care costs each year.
ACS CAN, the nonprofit, nonpartisan advocacy affiliate of the American Cancer Society, supports evidence-based policy and legislative solutions designed to eliminate cancer as a major health problem. ACS CAN works to encourage elected officials and candidates to make cancer a top national priority. ACS CAN gives ordinary people extraordinary power to fight cancer with the training and tools they need to make their voices heard. For more information, visit www.fightcancer.org.
FOR MORE INFORMATION, CONTACT:
Nicole Bender
American Cancer Society Cancer Action Network
Phone: 202-661-5773
E-mail: [email protected]