Policy Documents

Cigarette Tax Hikes: A Feeble Attempt to Cut Smoking Rates and Balance the Budget

Nick Baker –
March 18, 2008

Last week, the Kentucky House of Representatives approved a 25 cent increase in the state's cigarette tax in an effort to help eliminate the state's budget deficit. The tax hike is part of a budget plan proposed by Gov. Steve Beshear and now goes to the Senate for approval.

Higher cigarette taxes are needed, some legislators say, to avoid "deep cuts" in the state's budget. They find it is easier to balance the budget on the backs of smokers than to cut wasteful spending.

Many public health organizations support increased cigarette taxes. They claim higher taxes will force smokers to quit, while the additional tax revenue will pay for public health programs. But why pay for public health programs from a revenue source one is trying to eliminate?

Tobacco is a perfectly legal product. It is not the government's job to wean its citizens away from vices it deems unhealthy. Increased tobacco tax hikes are another example of America's politicians patting their citizens on the head and saying, "Trust us. We know what's best for you." Recently, lawmakers have banned trans fats, tried to tax soda, and have attempted to prevent the obese from eating in restaurants. Where will this public health insanity end?

The following collection of articles addresses the effects of increased tobacco taxes.


Smoke and Borders: How Tobacco Tax Increases Promote Cross Border Shopping

http://heartland.org/article.cfm?artId=20801

J. Scott Moody of The Maine Heritage Public Policy Center describes how New Hampshire has benefitted from its neighbors' high cigarette taxes.

Six Reasons Not to Raise Tobacco Taxes

http://www.heartland.org/Article.cfm?artId=13816

Economist Dr. William Anderson of the Oklahoma Council of Public Affairs outlines the pitfalls of higher cigarette taxes.

Unholy Alliance: State, Big Tobacco

http://www.rep-am.com/articles/2008/01/08/opinion/309439.txt

An editorial from the Waterbury Republican-American on Connecticut's unsuccessful attempt to cut smoking rates through higher cigarette taxes.

States Intensify Assault on Tobacco Use

http://www.heartland.org/Article.cfm?artId=22890

A recent article from Heartland's Budget & Tax News on current tobacco legislation.

Increased Tobacco Tax May Be Affecting Local Businesses

http://www.fdlreporter.com/apps/pbcs.dll/article?AID=/20080108/FON0101/801080357/1985

Retailers have seen their revenues shrink after Wisconsin's recent cigarette tax hike.