Cigarette Tax Increase Is A Victory for Michigan Kids and Taxpayers, But State Should Also Increase Funding for Tobacco Prevention and Cessation

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

Jun. 24 2004

Washington, DC — The 75-cent increase in Michigan’s cigarette tax, to $2 per pack, is an important step toward protecting the state’s kids and taxpayers from the devastating toll of tobacco. Increasing the cigarette tax is a proven way to reduce smoking among both kids and adults and save lives by reducing smoking-caused disease.

We applaud Governor Granholm for her leadership in proposing both the higher cigarette tax and increased funding for the Healthy Michigan Fund. Public opinion polls showed that voters strongly wanted tobacco revenue used to address tobacco-caused death and disease. However, in refusing to use any of the cigarette tax revenue to increase funding for tobacco prevention and cessation programs, legislative leaders made clear their motivation was to increase revenue rather reduce smoking by kids. Michigan already ranks dead last in the nation in utilizing funds from the 1998 state tobacco settlement for their intended purpose - to prevent kids from smoking and help smokers quit. The additional revenue from the cigarette tax increase provided an opportunity to correct this mistake, as well as help the many smokers encouraged to quit by the tax increase. It is unfortunate that legislative leaders did not share Governor Granholm’s commitment to our kids and our health.

Nevertheless, the cigarette tax increase is an important step forward. Michigan can expect a 75-cent per pack cigarette tax increase to prevent some 89,000 kids alive today from becoming smokers, save 40,000 Michigan residents from smoking-caused deaths, produce $1.51 billion in long-term health care savings, and raise roughly $342 million a year in new revenue. Michigan is one of 33 states, along with the District of Columbia and Puerto Rico, that have increased cigarettes taxes since January 1, 2002. 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.

Tobacco use is the leading preventable cause of death in Michigan, killing 14,700 people and costing Michigan taxpayers $2.65 billion in health care costs each year. 22.6 percent of high school students currently smoke, and 29,900 more kids become regular, daily smokers every year, one-third of whom will die prematurely. Michigan’s higher cigarette tax will help reduce this terrible toll, but a well-funded tobacco prevention and cessation program would do even more.

 

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