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Thursday, May 10, 2012

New Study Shows Higher Tobacco Taxes Greatly Reduce Youth Smoking

Health advocates today urged Illinois leaders to increase the cigarette tax by $1/pack following a new national study that confirms higher tobacco taxes are very effective at reducing smoking and other tobacco use, especially among kids.

The new study, conducted by researchers at the University of Illinois at Chicago, found that the large federal tobacco tax increase implemented on April 1, 2009, reduced the number of youth smokers by at least 220,000 and the number of youth smokeless tobacco users by at least 135,000 in the first two months alone.

The researchers emphasized that the study measured only the immediate impact of the tax increase through May 2009, and the number of youth prevented from smoking and using smokeless tobacco would be much larger over time.

The study showed that a large tobacco tax increase “can influence youth tobacco use prevalence within a very short time period,” the researchers wrote. “Adolescents not only respond to tax policy changes, but the speed of their response is fast. The prevalence of smoking and use of smokeless tobacco… dropped immediately following the tax increase in this study, and statistically significant and meaningful changes could be measured and detected within 30 days of the tax increase.”

In Illinois, health advocates are working to increase the cigarette tax by $1/pack to reduce further cuts to the Medicaid program.

“This study shows exactly why Illinois should increase the tobacco tax – because it will keep kids from smoking, encourage smokers to quit and save lives,” said Kathy Drea, Vice President, Advocacy for the American Lung Association in Illinois. “The tobacco companies are fighting the tobacco tax for the same reason – because they know it works and will reduce smoking. Illinois legislators should side with kids over Big Tobacco and increase the cigarette tax by $1 per pack.”

Health advocates say a higher tobacco tax is a win-win-win for Illinois – a health win that reduces smoking and save lives, a financial win that reliably raises revenue and a political win that polls show is popular with voters.

More Information on New Study

A 2009 law approved by Congress, the Children’s Health Insurance Program Reauthorization Act , increased the federal tax rate on cigarettes by 61.66 cents per pack (from 39 cents to $1.0066 per pack) and on moist snuff, the most common form of smokeless tobacco, by 92.5 cents per pound (from 58.5 cents to $1.51 per pound). Taxes were also increased on other forms of smokeless tobacco.

The new study investigated the changes in youth smoking and smokeless tobacco use rates following the April 2009 federal tobacco tax increases, using data from the Monitoring the Future survey, an annual national survey of 8th, 10th and 12th grade students. Because the survey is conducted from February through May each year, it coincided with the April 1 tobacco tax increase and provided an effective means to measure the immediate impact.

The study found that the tobacco tax increase had a substantial and immediate impact.

The percentage of students who reported smoking in the past 30 days dropped between 9.7 percent and 13.3 percent immediately following the tax increase, while the percentage who reported using smokeless tobacco dropped between 16 percent and 24 percent (because the survey asked about behavior in the past 30 days, the study used three different models, with different cutoff dates, to fully assess the impact of the tax increase).

Because of the tax increase, there were between 220,000 and 287,000 fewer current smokers and between 135,000 and 203,000 fewer smokeless tobacco users among middle and high school students in May 2009, the study estimated.

The study controlled for other factors that influence youth tobacco use, including individual, family and school characteristics as well as state tobacco control measures, including state cigarette taxes, smoke-free air polices and tobacco control funding.

The study also found that, even as youth tobacco use declined, federal tobacco tax revenues increased by 147 percent in the 12 months following the increase – from $7.1 billion in the 12 months before to $17.5 billion in the 12 months after.

The new study adds to the already overwhelming evidence, confirmed by the recently released Surgeon General’s report on tobacco, that higher tobacco taxes are one of the most effective ways to reduce smoking, especially among kids.

Tobacco use is the leading preventable cause of death in the United States, killing more than 400,000 people and costing the nation $96 billion in health care bills each year. In Illinois, tobacco use claims more than 16,600 lives each year and costs the state $4.1 billion annually in health care bills, including $1.8 billion in Medicaid payments alone.

Support for the study was provided by the Robert Wood Johnson Foundation and the National Cancer Institute. The study was published online by the National Bureau of Economic Research.

Kathy Drea, Vice President, Advocacy

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