New Hampshire Budget Falls Short in Protecting Kids from Tobacco; State Should Increase Cigarette Tax By $1 and Provide Funding For Tobacco Prevention Programs

Washington, D.C. — It is disappointing and a missed opportunity for New Hampshire's health that a budget conference committee today approved a budget that includes only a 45-cent increase in the state cigarette tax and provides zero funding for programs to prevent kids from smoking and help smokers quit. This budget eliminates the miniscule amounts New Hampshire had previously been spending on these programs. New Hampshire can achieve much greater health and financial benefits by increasing the cigarette tax by $1 per pack and allocating some of the new revenue for tobacco prevention and cessation programs.

With the added revenue from the 45-cent cigarette tax increase, New Hampshire would receive more than $450 million in tobacco-generated revenue over the next two years from tobacco taxes and the 1998 state tobacco settlement, but will spend nothing to help smokers quit or prevent kids from starting to smoke. As a result, New Hampshire would rank last in the nation in spending on tobacco prevention programs despite the fact that tobacco-related illness costs the state $564 million a year in health care bills.

It is penny-wise and pound-foolish to shortchange tobacco prevention programs. These programs are proven to reduce smoking among both youth and adults, save lives and save money by reducing tobacco-related health care costs. An August 2008 scientific study found that California's tobacco prevention program saved $86 billion in health care costs in its first 15 years, which is nearly 50 times what the state spent on the program. Few government programs provide such a tremendous return on investment. The Centers for Disease Control and Prevention recommends that New Hampshire spend $19.2 million a year on tobacco prevention and cessation programs, which is just a fraction of the hundreds of millions of dollars the state collects each year from tobacco taxes and the 1998 state tobacco settlement.

Even with the proposed 45-cent cigarette tax increase, New Hampshire would still have the lowest cigarette tax in New England at $1.78 per pack. The other New England states have cigarette tax rates ranging from $2 to $3.46 per pack. By increasing its cigarette tax by $1 per pack, New Hampshire would achieve much greater health and financial benefits. A $1 cigarette tax increase would raise an additional $18.6 million in new revenue; reduce youth smoking by an additional 7.7 percent; keep 6,600 more youth from becoming regular smokers; save another 3,000 people from smoking-related death, and save an additional $147.8 million in future smoking-related health care costs.

Tobacco use is the leading preventable cause of death in the United States. In New Hampshire, tobacco claims more than 1,700 lives each year and costs the state $564 million annually in health care bills, including $115 million in Medicaid payments alone. Government expenditures related to tobacco amount to a hidden tax of $628 every year on every New Hampshire household. Nineteen percent of New Hampshire high school students smoke, and 1,800 more kids become smokers every year. A $1 cigarette tax increase, with some of the revenue allocated to tobacco prevention and cessation programs, would significantly reduce tobacco's devastating toll in New Hampshire.