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Cigarette Tax Increase Lowered NY Smoking Rates

Ruzanna Harutyunyan's picture

One year after New York State substantially increased the state excise tax on cigarettes, adult smoking in the state is at the lowest rate ever recorded, the State Health Department announced today.

A recent state health survey found that 16.7 percent of adult New Yorkers were smokers in 2008, a 12 percent decrease, or nearly 310,000 fewer adult smokers from 2007.

On June 3, 2008, the state cigarette excise tax increased by $1.25 to a total $2.75 per pack of cigarettes, making it the highest state cigarette tax in the nation at the time.

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Research shows that cigarette taxes are the most effective way to reduce smoking because higher prices drive people to quit smoking and prevent young people from starting smoking. The Campaign for Tobacco Free Kids estimated that New York's $1.25 cigarette tax increase would prevent more than 243,000 New York children alive today from smoking and motivate 140,000 more New York smokers to quit for good.

"For the first time, New York's adult smoking rate has dropped below 17 percent, which is well below the national average," said State Health Commissioner Richard F. Daines, M.D. "The data reported today show that New York's tobacco control efforts are having an impact and that keeping the price of cigarettes high is a proven intervention that has helped 310,000 New Yorkers become ex-smokers, who can now lead healthier, longer lives."

The New York State Tobacco Control Program promotes policies that support indoor and outdoor smoke-free areas as well as high tobacco product prices to prevent youth from starting and to encourage adults to quit. The program increases access to effective cessation services, including support for the New York State Smokers' Quitline -- 1-866-NY-QUITS -- and supports media campaigns designed to increase public awareness of the dangers of tobacco use and motivate smokers to quit for good.

Last year's state cigarette tax increase, coupled with the 61-cent federal increase that took effect this April, have resulted in a continued peak level of calls to the toll-free New York State Smokers' Quitline. Since June 3, 2008, when the state tax increase took effect, the Quitline has received over 220,000 calls and provided free nicotine replacement medications to over 140,000 smokers trying to break their addiction to tobacco.

Additionally, during the same period the program's hard-hitting, emotionally-evocative media campaigns depicting the devastating health effects from smoking have motivated over 220,000 smokers to contact the Quitline to receive free coaching and nicotine replacement medications. Ads promoting the Quitline encourage thousands more New York smokers to try to quit on their own.



This is rubbish - but it makes for good anti-tobacco propaganda. Reduction in smoking ?- give me a break - Don't they realise that there will be no reduction - just a reluctance to admit to smoking because of the ever more pernicious nature of anti-tobacco and a move to obtain their tobacco by illicit means. Smoking bans always result in more smoking - dictating what people can and cannot do will always result in resistance and backlash! Give your heads a shake and read this from a person who knows what he is talking about ; Cigarette Taxes Are Fueling Organized Crime By PATRICK FLEENOR May 7, 2008 Last month, New York law enforcement authorities announced the arrest of Queens resident Rafea al-Nablisi for smuggling 12,000 cartons of cigarettes a week. It was not the first such arrest, and thanks to New York's latest cigarette tax hike, it will not be the last. On April 23, less than two weeks after Mr. Nablisi's arrest was made public, Gov. David Paterson signed into law a $1.25 per-pack tax hike on top of the state's $1.50 per-pack tax. That's in addition to New York City's own $1.50 per-pack tax. Come July 1, New York City's smokers will be paying on average $9 a pack for legal cigarettes. But if history is any guide, most cigarettes sold will actually be trucked up from Virginia, or shipped in from China, by "butt-leggers" who can make over $1 million on each tractor-trailer load of smuggled smokes. The blunt fact, which politicians of both political parties are determined to ignore, is that high cigarette taxes in New York have led to a bloody, decades-long smuggling epidemic. While the problem first surfaced during the Great Depression, tax hikes in the early 1960s created a major profit opportunity for smugglers and kicked the epidemic into high gear. By 1967, a quarter of the cigarettes consumed in the Empire State were bootlegged. New York City's finance administrator labeled cigarette smuggling the "principal stoking facility of the engine of organized crime." Crime rapidly spread beyond New York's borders, as trucks carrying cigarettes across the country were hijacked and businesses selling them robbed to supply New York's black market. In 1972, the chairman of a New York commission told Congress that retailers and other workers were "confronted almost daily with the risk and dangers of personal violence which are now inherent in their industry." State and city officials responded with mandatory prison sentences and expanded police powers of search and seizure. But in 1973 a state commission found the crackdown to be "completely ineffective and a failure." Desperate state officials formed a special task force that proposed abolishing the city's cigarette excise. Gov. Malcolm Wilson embraced the idea, explaining: "One major incentive to organized crime is the high New York City cigarette taxes, piled on top of the state tax, which have made that city the promised land for cigarette bootleggers." Fuhgedaboutit. Parochial politics scuttled any possibility that the tax would be abolished. But a series of homicides, including witness murder, discouraged lawmakers from further tax hikes in the late 1970s and early '80s. High inflation in those years drove cigarette prices up, but the fixed excise tax – the smuggler's profit margin – declined by more than 40%, greatly reducing bootlegging and related crime. Lawmaker memories are short, however, and the state again began raising the cigarette tax in the 1980s. As a state tax enforcement official noted, it soon became "literally more profitable to hijack a cigarette-delivery truck than an armored truck." More tax hikes followed in the 1990s. City and state records of tax-paid cigarettes show sales plummeting, despite stable smoking rates. This signals the resurgence of smuggling and large-scale tax evasion. As the Bureau of Alcohol, Tobacco and Firearms said in September 2002 of New York's cigarette smuggling, "Traditional organized crime is involved, terrorist groups are involved, and street gangs are involved." Rivalry among these groups has resulted in numerous shootings and homicides. The connection to terrorism is no exaggeration. When New York police cracked another smuggling ring in 2005, they uncovered a multimillion dollar flow of funds from New York City to unknown individuals in the Middle East. Police Commissioner Raymond Kelly gave voice to the obvious conclusion: Terrorists probably got the money. Just a few weeks before that 2005 bust, Buffalo-area businessman Aref Ahmed had been sentenced to three years and a month for cigarette smuggling. The feds said he'd used the racket to fund "scholarships" at terrorist training camps in Afghanistan during the spring of 2001. Going back to 1993, counterfeit cigarette stamps were found in the apartment of the first World Trade Center bombers. Politicians continue to use the health of smokers as their excuse for higher cigarette taxes. This view is myopic. As Gov. Wilson argued three decades ago, high cigarette taxes are bad public policy because of their effect on the rest of us. In the 1960s and '70s, organized crime exploited high cigarette taxes at our expense. Today we face an even deadlier adversary. Patrick Fleenor is chief economist of the Tax Foundation and author of "Cigarette Taxes, Black Markets, and Crime: Lessons from New York's 50-Year Losing Battle" (Cato Institute, 2003).