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Elsewhere: • Connecticut has increased its tax from 50 cents to $1.51 per pack in 2002. Since then, per- capita consumption of cigarettes has fallen 37%. • New Jersey has raised its tax from 80 cents to $2.40 in 2002. Smoking has dropped 35%. • California raised its cigarette tax to 87 cents per pack in 1999 but hasn't changed it since. Smoking is down 18% since the tax increase. By comparison, South Carolina has kept its lowest-in-the-nation cigarette tax at 7 cents since 1977. Cigarette consumption there has fallen 5% since 2000. As Congress considers raising the federal cigarette tax from 39 cents to $1 a pack, the nation may be about to experience one of the biggest onetime declines in smoking, health experts and economists say. "I expect a bigger drop than almost anything we've seen before," said Frank Chaloupka, a University of Illinois at Chicago economist who has studied the effect of taxes on smoking. He predicts smoking will drop 6% if the 61-cent tax increase is passed. The Senate approved the increase last week as a way to pay for expanded government health care for children. The House has proposed a 45-cent increase. President George W. Bush has threatened to veto the bill over the increased cost of the health program. Nationwide, the number of cigarettes smoked fell last year from a peak of 2,095 per capita in 1976 to 1,293 per capita, according to an annual industry report. Research shows that health concerns, tax increases and higher retail prices all have played a role in the decline. Smoking falls 2.5% to 5% for every 10% increase in the price of cigarettes, according to the Congressional Budget Office. Thomas Briant, executive director of the National Association of Tobacco Outlets, agreed consumption would fall about 6% if a $1 federal tax is imposed but said the high tax also would have negative effects. State governments would suffer a sharp decline in revenue, and black-market sales and thefts would increase to avoid the tax, he said. "Using taxes to legislate use of a legal product is not good public policy," Briant said. Earlier this year in Michigan, Gov. Jennifer Granholm proposed raising the state's cigarette tax by a nickel, to $2.05 a pack. © Copyright 2006 by CigarettesOn.Com |
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