ON APRIL 1, 2009, the federal tax on cigarettes jumped from 39 cents to $1.01 per pack, raising the overall inflation-adjusted cost of cigarettes by more than all the other state and local tax increases over the previous decade combined.
And most of us went on with our lives, without giving this much if any thought; as USA Today noted on Tuesday, “the tax hike and its repercussions remain mostly unknown to the non-smoking public.” Indeed, here in South Carolina, we paid much more attention to our own Legislature’s smaller, and longer-overdue, decision a year later to increase our state tax from the nation’s lowest 7 cents per pack to 57 cents.
The federal tax has generated more than $30 billion in the two and a half years since it was instituted; our own tax brings in more than $100 million per year.
But while the cost of cigarettes has increased, the cost of smoking is going down. Not for smokers; for the rest of us. That’s because the higher cigarette tax did precisely what economists and public-health advocates knew it would: It reduced smoking.
As USA Today reported: “The tax hike has helped restart a long-term decline in smoking that had stalled in recent years. About 3 million fewer people smoked last year than in 2009, despite a larger population, according to surveys by the Centers for Disease Control and Prevention.”
A third of those people who quit smoking are adults whose medical care we all pay for through Medicaid.
Teen smoking, the paper reported, immediately fell by 10 percent or more. A separate CDC survey of teen smoking released this summer shows that in 2011, smoking rates fell to a new low of 16 percent among high school students and 4 percent among middle school students — less than half what the rates were at their peak in the 1990s.
The teen smoking decline is particularly significant, because nearly all addicts start smoking in their teens. It means that about 3 million fewer kids embarked on a lifetime of addiction and hideous diseases last year than did so two decades earlier.
This is why, while others argued over how best to divvy up the money, or whether the state needed additional revenue, our editorial board argued for years that South Carolina would be better off with a higher cigarette tax even if we burned the money. That’s still true today.
Smoking is an ugly way to live and a painful and expensive way to die. In addition to saving lives, over time, higher cigarette taxes will reduce the $1 billion we spend every year in South Carolina and the $96 billion we spend nationally — for Medicaid, Medicare, health insurance for government employees and our own health insurance — to treat the ravages of smoking.
Did the anemic economy contribute to the lower smoking rates? Almost certainly, just as it helped reduce how much we drive, leading to fewer highway deaths. But that doesn’t reduce the significance of the change. What it does, if anything, is remind us of one of the best tools we have to further reduce teen and adult smoking, and reduce the price of smoking for the rest of us: Raise the cigarette tax even more.
Although it’s no longer the lowest in the nation, South Carolina’s tax still is lower than all but nine other states. If we raised it to $1, it would be 63 cents below the national average, and lower than all but 19 other states. With the dramatic decline of tobacco as an economic engine of our state’s economy, and an ever-decreasing portion of U.S. tobacco being sold domestically, there’s simply not a good reason not to raise this anti-death tax even more. And so very many good reasons to do so.