Jul. 1 2002
Washington, DC — With enactment of the new state budget, Indiana will become a national leader in protecting kids from tobacco by increasing the state's cigarette tax by 40 cents a pack and protecting funding for the state's comprehensive tobacco prevention program. With this one-two punch of prevention spending and a cigarette tax increase, Indiana can looking forward to reducing smoking among both kids and adults, saving lives, and saving money for taxpayers by reducing smoking-caused health care costs. As an added benefit, the cigarette tax increase will also raise much-needed revenue for the state and is popular among voters. We applaud Senate Finance Committee Chair Larry Borst for his diligent work to protect tobacco settlement dollars and the tobacco prevention program, while also championing the cigarette tax increase alongside Governor Frank O'Bannon. Senator Borst and Governor O'Bannon's efforts have produced a win-win-win solution for Indiana.
Indiana's actions closely follow recommendations from a recent report by the National Cancer Institute that concluded, "research clearly indicates that tobacco control interventions…can be very effective in reducing cigarette smoking among adolescents. In particular, these include increased tobacco taxation and stronger tobacco control policies." Indiana's leaders rightly recognized that, even in these difficult budget times, tobacco prevention is one of the smartest and most fiscally responsible investments the state can make.
Higher cigarette taxes have been proven to reduce smoking – especially among kids. Indiana can expect a 40-cent per pack cigarette tax increase to prevent some 43,000 kids alive today from becoming smokers, save 20,000 Hoosiers from smoking-caused deaths, produce $760 million in long-term health care savings, and raise roughly $274 million a year in new revenue. Hoosiers strongly support a cigarette tax increase. A December poll released by public health groups found that 70 percent supported a 50-cent per pack increase. This support comes from Republicans, Democrats and Independents.
To achieve a sustained, long-term reduction in smoking, Indiana must also continue to use some of its tobacco settlement proceeds to adequately fund a comprehensive, statewide tobacco prevention program. Indiana has made a strong start by funding its prevention program at $32.5 million a year, just short of the minimum amount of $35 million a year recommended by the U.S. Centers for Disease Control and Prevention. The few states that have implemented such programs have reduced youth smoking by anywhere from 36 percent to 47 percent, depending on the age group, in just a few short years. Massachusetts and California are saving up to $3 for every dollar spent on tobacco prevention. Indiana will realize similar benefits if its leaders continue to properly fund and implement a comprehensive tobacco prevention program.
Tobacco's toll in Indiana is devastating – 31.6 percent of youths currently smoke, and 20,500 more kids become regular, daily smokers every year, one-third of whom will die prematurely. Smoking-caused health care expenses and productivity losses cost Indiana $3.7 billion a year. Because of its commitment to tobacco prevention, Indiana can look forward to reducing this terrible toll.
Indiana becomes the sixteenth state to have increased its cigarette tax in recent months, including Connecticut, Hawaii, Illinois, Kansas, Louisiana, Maryland, Nebraska, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Utah, Vermont, and Washington State. These measures have been approved by governors and legislatures of both political parties, as well as by voters in Washington, underscoring the broad political support for cigarette tax increases.