Improve health by raising taxes
MY VIEW • Big jump in tobacco tax can cut smoking
Allowing local cities and counties to raise taxes on tobacco is an appealing strategy to plug a persistent budget hole. But as Multnomah County and others consider this strategy, the discussion - and the Tribune's coverage of it - has avoided one of the most important outcomes of a tax: Higher prices and public education are the most effective way to get smokers to quit.
In his exploration of the tax in 'County Wants a Tax on Smokes' (Feb. 4), Tribune reporter Steve Law quoted several sources that got the facts wrong. To set the record straight, state cigarette tax revenues would likely not drop as a result of a 25-cent tax because that amount is simply not large enough to make many smokers quit or smoke less. Economic research has found that the retail price of cigarettes must go up by at least 10 percent (about 50 cents a pack, at today's prices) for sales to go down by a measurable amount.
Secondly, there is no evidence that state cigarette tax revenue - or any economic indicators - decreased after the Smokefree Workplace Law took bars, bowling centers and bingo parlors smoke free last January. In fact, 2009 cigarette tax revenue is higher than predicted.
Law reported that state Sen. Rick Metsger (D-Welches) thinks that the federal tax increase may have 'maxed out' cigarette taxes as a source of revenue in Oregon. On the contrary, 25 other states have higher cigarette taxes than Oregon. In every single instance where a state has passed a significant cigarette tax increase, cigarette tax revenues have increased. This occurs, despite significant declines in smoking rates and cigarette sales, because the higher tax per pack brings in much more new revenue than is lost by any decline in sales.
In Oregon, we don't have to worry about people leaving the state to buy cheaper cigarettes if our taxes increase. Washington's tobacco taxes are higher than Oregon's, and not many people live near the borders of other states. If one county's tax is higher and residents cross the county line to buy tobacco, total state tax revenues don't change.
Remember, the tobacco industry has carefully designed cigarettes to be highly addictive. The industry spends millions of dollars to market its products. It takes a lot more than a quarter a pack to push a smoker to quit - even for the average smoker who spends $1,500 every year on cigarettes.
In addition to a 10 percent cost increase, we know that education about the dangers of tobacco and secondhand smoke is highly influential, as is availability of counseling and medication to help people quit. A tax could maintain or even increase funding for these vital services. This is an investment that pays off: Since Oregon's Tobacco Prevention and Education Program debuted in 1996, the number of cigarettes smoked in Oregon has decreased by 46 percent.
But the work isn't done. Seventeen percent of Oregonians still smoke. Each year 7,000 Oregonians die of tobacco-related illness, an additional 800 die from exposure to secondhand smoke, 7,300 kids start smoking and we spend $2 billion on tobacco-related health care.
Breaking tobacco's deadly hold on our state is a top priority. A tax is a great way to get there, but the tax, in order to address public health concerns, has to be high enough to make smokers feel like it's just not worth it anymore, and it has to fund prevention programs.
Brett Hamilton is executive director of Tobacco-Free Coalition of Oregon. He lives in Northeast Portland.