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Cigarettes, death and taxes

Health InsuranceJustice System

Much as Americans hate taxes and tax increases, there's at least one levy even the government wishes people wouldn't pay. That's the tax on cigarettes, which the government dearly wishes people would avoid. When it come to cigarettes, a tax is its way of encouraging smokers to keep their money in their pockets by quitting, and a report this week from a coalition of health advocacy groups suggests the strategy is working.

According to a study released this week by the Citizens' Health Initiative, sales of cigarettes in Maryland have declined dramatically since 2008, when lawmakers raised the state tax on tobacco by a dollar. In 2012 Marylanders bought some 200 million packs of cigarettes, down from 243 million four years earlier. That's a 17 percent drop whose benefits not only include sharp reductions in youth and adult smoking rates but huge savings in long-term health care costs for the state as well.

The biggest beneficiaries of the tax were the state's young people, whose smoking rates dropped by nearly a third – 29 percent – in just the first two years after the tax was raised. That translates into some 15,000 fewer high school-age young people who never started smoking or who have already quit and more than 70,000 kids who won't become adult smokers. Among them are more than 30,000 kids who will avoid dying prematurely from smoking-related illnesses.

Adults also benefited from the effects of higher cigarette taxes, albeit to a somewhat lesser degree. Between 2007 and 2008 the smoking rate among adults declined from 17.1 percent to 14.9 percent, which helped put Maryland on track to becoming one of the five states with the lowest adult smoking rates in the nation (the national average is 20.6 percent). In health terms, that means some 99,000 fewer adult smokers and more than 23,000 Maryland adults who will avoid smoking-related premature deaths.

But precisely what, you may ask, is the government getting out of having tens of thousands fewer people buying cigarettes and paying taxes on them? The answer is: Plenty. Health advocates estimate the long-term savings in health-care costs for young people who quit or never started smoking to be about $1.5 billion, with another $800 million in savings for adult non-smokers. Cigarettes are the leading cause of preventable deaths in Maryland, killing more than 6,800 people every year. That costs the state some $1.7 billion in health care bills annually, including $476 million in Medicaid payments alone.

When you factor in the individual and public health benefits of encouraging smokers to quit, coupled with the enormous savings in medical costs that can be achieved through reducing juvenile and adult smoking rates, even the most hardened anti-tax types would be hard-pressed to deny that the 2008 cigarette tax increase was good for Maryland. Ironically, it might even have worked too well. That's because some of the revenue it raised was set aside to fund the state's Tobacco Use Prevention and Cessation Program, which was intended to enable smokers who were deterred by the tax from buying cigarettes to get help quitting. But the legislature later slashed funding for the program, so it never had a chance to achieve its full potential.

Next year health advocates expect the legislature to consider another $1 increase in the cigarette tax, with part of the new revenue earmarked for restoring smoking prevention and cessation programs. Passing any new tax in an election year is a tough sell for lawmakers, but research and experience clearly support the idea that a cigarette tax increase, coupled with a comprehensive tobacco prevention and cessation program, will multiply the benefits of both interventions. It may not be easy but it's the right thing to do. Maryland has made tremendous progress over the last 15 years in reducing smoking-related illnesses, deaths and health care costs, and each major reduction has coincided with an increase in the cigarette tax. The effort has been one of the great public health success stories in recent decades, and it represents an achievement that Maryland lawmakers must continue build on.

Copyright © 2014, The Baltimore Sun
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