Excise Taxes

State

Cost of cigarette litter may fall on San Francisco’s smokers (CA)
San Francisco Mayor Gavin Newsom has proposed a 33-cent cigarette tax that would be the first cigarette tax in the country expressly intended to cover the cost of cleaning up cigarette litter. He believes that not only would the tax help diffuse the $10.7 million the city spends each year to clean cigarette litter, but the added cost of cigarettes would also discourage smokers. The city’s annual “litter audit” showed that cigarette butts make up a quarter of all trash in public spaces. The proposal will be introduced to the city’s Board of Supervisors next month. Click here to read more.

Gov. Charlie Crist to approve cigarette tax (FL)
The Florida legislature has passed a bill that will raise the state’s cigarette tax to $1.34 per pack. The bill will also increase the tax rates on other tobacco products. The one dollar cigarette tax increase will be the first in the state since 1990. Read more here. Despite his initial opposition to increasing taxes, Governor Charlie Crist has signed the state budget, which includes the cigarette tax increase. Click here to read about the budget. Click here for more information from the Campaign for Tobacco-Free Kids on the benefits of the tax.

Hawai'i cigarette tax increase delivers victory for kids and taxpayers (HI)
Hawaii’s cigarette tax is set to increase $2 on July 1, which will make the tax the third-highest in the United States. The cigarette tax will increase an additional 20 cents in July 2010 and again in July 2011 to total $3. Click here to read a summary from the Campaign for Tobacco-Free Kids. Update: Cigarette tax increase may be flawed The office of the Governor is seeking legal advice on how to resolve two conflicting tobacco tax bills passed in the same week. HB 1175 was passed on May 7, and will increase the per-pack cigarette tax by $2 as of July. HB 895 was passed on May 8, and will increase the tax on tobacco products other than cigarettes, but will keep the cigarette tax at its current level of 60 cents per pack. Read more here.

Tobacco tax rejected by House panel (LA)
The House Ways and Means Committee in Louisiana rejected a proposal to increase the current state tobacco tax by $1 per pack. The decision makes it highly unlikely that any similar tobacco tax increase proposals in the state will become law this legislative session. Opponents of the proposal voted against the tax increase based on concerns about creating additional financial burdens during tough economic times. The proposal was supported by many doctors, health care professionals, and health advocacy groups. Click here to read more.

Miss. cigarette tax rising for 1st time since '85 (MI)
Mississippi Governor Haley Barbour recently signed a bill that increased the state’s cigarette tax to 68 cents as of May 15, 2009. Prior to this tax hike, the cigarette tax had remained at 18 cents since 1985, and was among the lowest in the nation. The tax was enacted partly in response to a $400 million state budget shortfall. The cigarette tax is expected to raise $113 million in the upcoming fiscal year. In addition, the Campaign for Tobacco Free Kids estimates that the tax will prevent 16,000 kids from becoming smokers and will encourage 9,700 smokers in Mississippi to quit. Click here to read more. Click here to read a press release from CTFK, which applauds this public health measure, and calls for legislators to use some of the tax revenue to increase funding for the state's tobacco prevention and cessation program.

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National

Federal and state cigarette excise taxes – United States, 1995-2009
On April 1, 2009, the largest federal cigarette excise tax increase in history went into effect, increasing the tax on cigarettes from 39 cents to $1.01 per pack. When combined with the state average excise tax of $1.20 per pack, the United States has achieved the Healthy People 2010 objective to increase the combined federal and average state cigarette excise tax to at least $2 per pack. Excise tax increases are among the most effective tools in preventing tobacco use, particularly among youth and young adults. However, tobacco growing states and other bordering southeastern states have a cigarette tax rate substantially lower than the national average of $1.20 per pack. Price increases combined with other evidence-based policy and clinical interventions can be effective in meeting national health objectives to decrease smoking prevalence and reduce smoking-attributable death and disease. Read the full article here in MMWR.

House votes to crack down on tobacco black market
The House of Representatives voted 397-11 to tighten controls on internet tobacco sales. The proposal would require online, telephone, and mail-order tobacco retailers to verify a buyer’s age and identity, and the U.S. Postal Service would be prohibited from shipping cigarettes and smokeless tobacco products in most cases. States would be able to enforce taxes on tobacco sales from out-of-state retailers, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) would have the authority to inspect internet tobacco retailers’ facilities and records. The passage of this measure comes in the wake of a Government Accountability Office (GAO) report noting that with increasing tobacco taxes, the tobacco black market is growing, and providing financial backing for terrorist groups and organized crime. Find out more here, or click here to follow the progress of this bill in the Senate.

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