Cigarette tax increased 62 cents

Smokers pay the price with new cigarette tax passed by Obama.

By Trevor Eischen

Published April 2, 2009

The federal increase on the cigarette tax was no joke to smokers on April Fools' Day.

On Wednesday, the federal excise tax on cigarettes increased from 39 cents to $1.01. The bill, signed into law by President Barack Obama, is the highest tax increase on cigarettes in U.S. history. The next day, the House of Representatives passed a proposed bill giving the Food and Drug Administration stricter regulation on tobacco products.

The revenue accrued from the new federal tax will go toward the expansion of the State Children's Health Insurance Program a program within the U.S. Department of Health and Human Services.

The federal tax, as well as different state taxes implemented across the nation, has caused tobacco products to increase in price exponentially.

Luckily for Missouri smokers, the state has the second lowest tax law in the nation at 17 cents per pack of 20 cigarettes. The lowest in the country, in South Carolina, is only 7 cents. The highest state tax, in New York, is $2.75.

Although the tax collects revenue strictly at the federal level, Kit Wagar, Missouri Department of Health and Senior Services spokesman, said the tax promotes good health.

"Our job is to improve and enhance health and we know when people smoke less they're healthier," Wagar said. "When the price of anything goes up, people will buy less."

Linda Cooperstock, public health planner at the Columbia/Boone County Department of Public Health and Human Services, said she also favors the tax's goal.

"Any time you can raise the cost of cigarettes you can decrease the number of people smoking," Cooperstock said. "From a health perspective we see this as a nice step forward, especially for a state like Missouri who has the second lowest cigarette tax."

Cooperstock said any tax increase more than 10 percent declines the number of prospective smokers and current smokers. Cooperstock said smoking affects all taxpayers.

"Smoking does cost a lot of money to everybody," Cooperstock said. "It costs smokers and non-smokers in terms of health care costs."

Smokers have to reconsider their habits in the wake of the new tax.

"Basically, they're going to get really, really expensive," freshmen Jeff Wiegert said. "First I thought I might have to stop smoking."

David Kuneman is a retired pharmaceutical chemist from agricultural corporation Monsanto and Midwest Regional Director for the Citizens of Freedom Alliance Inc. -- a group devoted to individuals', especially smokers', rights. Kuneman said he disagrees with the new tax.

"I don't think they did very careful research," Kuneman said.

Kuneman, unlike Wagar and Cooperstock, said there is insufficient evidence that tax hikes cause a decline in smoking. The support for health care programs, which he said were failing, should be spread to all taxpayers.

"If the SCHIP program is a good program, everybody should be funding it," Kuneman said. "Everybody should be paying their fair share to pay it, not just smokers."

A recent Gallup poll shows Americans in the lower-income brackets comprising the majority of smokers in the country. Kuneman said Obama has rescinded his campaign promises of lower taxes, especially from lower-income Americans to which his message was directed.

"Over 60 percent of smokers earn less than $30,000 a year," Kuneman said. "During President Obama's campaign, he promised only to raise taxes on the very rich. In my opinion, he broke that promise."