tocacco plant Native American Tobaccoo flower, leaves, and buds

tocacco Tobacco is an annual or bi-annual growing 1-3 meters tall with large sticky leaves that contain nicotine. Native to the Americas, tobacco has a long history of use as a shamanic inebriant and stimulant. It is extremely popular and well-known for its addictive potential.

tocacco nicotina Nicotiana tabacum

tocacco Nicotiana rustica leaves

Tobacco tax increase expected to reduce smoking

For the estimated 20% of Americans who smoke cigarettes, the impact of a federal excise tax increase that takes effect Wednesday is already being felt.

Earlier this month the manufacturer of Marlboro, Parliament and Virginia Slims, Philip Morris USA, increased prices by 71 cents a pack, 9 cents more than the federal tax increase. The maker of Camel, Kool and Salem cigarettes, R.J. Reynolds Tobacco, bumped wholesale prices up by 44 cents a pack and reduced discounting.

The revenue from the tax increase, which will be used to expand coverage under the State Children’s Health Insurance Program to an additional 4 million low-income children, was signed into law in February.

It calls for a 62-cents-a-pack increase, to $1.01, in federal excise taxes on cigarettes for the nation’s estimated 45 million cigarette smokers as well as increases in taxes on little cigars, cigars, and pipe and chewing tobacco.

The higher prices should have the positive effect of reducing teenage smoking, according to Dr. Jonathan Klein, a professor of pediatrics at the University of Rochester.

“There’s very good evidence that adolescents are the most price-sensitive,” Klein said.

New York state, which has among the highest tobacco tax rates in the nation, has seen a decline in teenage smoking. States with lower taxes have not, Klein said.

Last year the state increased its tax on cigarettes by $1.25, from $1.50 to $2.75 per pack.

New York also imposes a 4% state sales taxes on tobacco products, said Tom Bergin, spokesman for the state Department of Taxation and Finance. Local sales taxes push up the overall sales tax to more than 8% in Yonkers and New York City and on Long Island.

But the biggest impact is expected to be hundreds of miles away from the Empire State, where tobacco taxes are low. South Carolina has the nation’s lowest tax on cigarettes — 7 cents a pack. Missouri imposes a 17-cents-a-pack tax.

The current average among the states is $1.19 a pack, according to Eric Lindbloom, director of policy research for the Campaign for Tobacco Free Kids.

Dr. Irwin Redlener, president of the Children’s Health Fund in New York City, predicts that adult smokers who are economically “onthe edge” also may quit.

“Given the economic climate that we are in … a new tax may be the final incentive to get them to stop smoking,” Redlener said.

But Redlender said he dislikes the fact that the tax increase was used to finance an expansion of the State Children’s Health Insurance Program under legislation signed into law in February.

“I don’t want to see our health coverage of children dependent on this,” said Redlender, who said he would prefer to see the expanded coverage paid for from the federal government’s general revenue.

The Campaign for Tobacco Free Kids is hailing the fact that the tax increase will equalize the way that small cigars, which are increasing in popularity, are taxed.

“They really are cigarettes pretending to be little cigars so you can pay less tax,” Lindbloom said. “This is a problem nationwide. It’s a problem with state tax rates. It’s a big deal because cigarette sales have been going down, but little cigar sales have been going up.”

The federal tax on little cigars is currently 3.7 cents per pack of 20, while a pack of cigarettes is taxed 39 cents.

Come Wednesday, both types will be taxed $1.01 a pack.Likewise, the tax on roll-your-own tobacco was 4.5 cents per pack and will increase to $1.01.

Smaller tax increases will be imposed on large cigars and chewing tobacco, which will be taxed at 11.3 cents a can.

The International Premium Cigar and Pipe Retailers Association predicts that the nation’s estimated 12 million cigar smokers and 1.2 million pipe smokers will trade down to less-expensive blends.

The average cigar smoker smokes only two cigars a week, said Joe Rowe, the group’s executive director.

“I suspect pipe smokers will continue to buy pipe tobacco and smoke,” Rowe said. “Pipe tobacco has been declining for years, and it’s a choice and not habit.”

Frank Cervone, store manager of Mom’s Cigar in Scarsdale, agreed.

“They are probably not going to stop smoking but go to a lower-priced cigar,” said Cervone, whose store sells premium cigars for $4 to $12.50 each.

Source: Usatoday

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1 comment to Tobacco tax increase expected to reduce smoking

  • Price increases haven’t always been effective in smoking reduction. Someone who is addicted to smoking will buy cigarettes whatever the cost and cut down on other expenditure. In younger people, they tend to start smoking because of peer pressure and aren’t initially heavy smokers, so the impact of cost isn’t so great because they don’t buy and consume as much tobacco anyway and aren’t hugely affected by the price. Better to educate people not to start smoking, and help people who already smoke.

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