Anti-smoking advocates on Tuesday released a report showing revenue from higher cigarette taxes remains stable while causing smokers to kick the habit, which they said supports their call for a $1 tax hike on cigarettes.
Frank Chaloupka, an economics professor at the University of Illinois at Chicago, found states that increased their cigarette tax not only brought in more tax revenue than before the hike but revenues tended to be predictable.
“As taxes and prices have gone up over time, each of those increases is associated with a significant reduction in the number of adults who are smoking,” Chaloupka said in a telephone call with reporters.
Chaloupka examined cigarette tax hikes in all 50 states from 2002-13. He found while sales of cigarettes decreased, tax revenues increased and did not drop below the pre-increase amounts. Chaloupka said there’s no evidence that steep cigarette increases have caused smokers to cross state lines to buy cheaper smokes.
The American Cancer Society’s Cancer Action Network, American Heart Association, American Lung Association, and the Campaign for Tobacco-Free Kids released the report and called on Gov. John Kasich to propose a $1 per pack tax increase in his upcoming state budget.
Ohio’s $1.25 per pack tax ranks 29th highest among states and Washington, D.C., according to the Federation of Tax Administrators. A $1 per pack increase would generate $342 million in its first year, according to the American Lung Association in Ohio.
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