Kids and Taxpayers Win as Nevada Increases Cigarette Tax

Statement by William V. Corr Executive Director, Campaign for Tobacco-Free Kids

Jul. 22 2003

Washington, D.C. — Nevada's leaders have taken an important step toward protecting the state's kids and taxpayers from the devastating toll of tobacco by increasing the state cigarette tax by 45 cents to 80 cents per pack. This is a win-win-win solution for Nevada that will reduce smoking among both kids and adults, save lives by reducing smoking-caused disease and raise much-needed revenue to help balance the state budget. Nevada can expect a 45-cent per pack cigarette tax increase to prevent some 16,000 kids alive today from becoming smokers, save 7,300 Nevadans from smoking-caused deaths, produce $274 million in long-term health care savings, and raise roughly $63 million a year in new revenue.

Nevada voters strongly support a cigarette tax increase. A June 2002 poll released by public health groups found that 70 percent of Nevada voters supported a 50-cent per pack increase. This support comes from Republicans, Democrats and Independents.

Nevada becomes the 31st state to increase its cigarette tax since January 1, 2002. Despite these clear benefits of cigarette taxes, and polls showing broad, bipartisan public support for cigarette tax increases across the country, 10 states continue to have cigarette tax rates less than 25 cents per pack. We urge the 19 states that have not yet increased cigarette taxes to do so quickly so they can realize the many benefits.

Studies show that every 10 percent increase in the price of cigarettes reduces youth smoking by seven percent and overall cigarette consumption by three to five percent. Preliminary evidence confirms every state that has significantly increased its cigarette tax in recent years has enjoyed substantial increases in revenue, even while reducing cigarette sales. Michigan, for example, collected $104 million more in cigarette tax revenue in the last five months of 2002 compared to the year before despite a 15.5 percent reduction in cigarette pack sales. Nebraska's 2002 tax increase has produced $10 million more in additional revenues between October 2002 and April 2003 than in the same period the year before. Even in New York City, where the combined state and local cigarette tax rate has increased to $3.00 per pack, the city's tax increase from 8 cents to $1.50 per pack is on track to bring in a quarter of a billion dollars in new revenue over the first year despite sharp declines in cigarette sales.

Tobacco use is the leading preventable cause of death in Nevada. 25.2 percent of high school students currently smoke, and 6,600 more kids become regular, daily smokers every year, one-third of whom will die prematurely. Smoking-caused health care costs Nevada and its taxpayers $440 million a year. Nevada's higher cigarette tax will help reduce this terrible toll.

 

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