Ohio last raised its cigarette tax in 2005, from 55 cents to $1.25 per pack. In April 2009, the federal excise tax increased from 39 cents to $1.01 per pack.
About $3.1 billion was spent on cigarettes in Ohio in fiscal 2009, down from $3.5 billion in fiscal 2005.
According to an industry-funded report, cigarette tax collections in Ohio were $872.3 million in fiscal 2009. Doubling the cigarette tax rate would boost those tax revenues to more than $1.2 billion in 2011, Chaloupka said.
John Stephenson of the National Taxpayers Union said the tax hikes are good politics, but bad policy.
Such a tax hike would drive Ohioans to buy cigarettes — and other convenience store products — in neighboring states with lower cigarette tax rates. “In a state with over 10 percent unemployment, that’s the last thing Ohio needs.”
While 30 percent of Ohioans smoked in 1984, just more than 20 percent did in 2009, ranking the state 13th nationwide, according to the Ohio Department of Health. Each 1 percent decline in smoking rates would save the state $838 million in health care costs, including $148.5 million in state Medicaid costs, Chaloupka said.
Smoking’s direct costs to Ohio’s economy exceed $13.8 billion annually, according to a Penn State University study released this week that claims smoking cessation programs more than cover their costs. That figure includes workplace productivity losses, premature death losses and direct medical expenditures.
But Ohio ranks 45th among states in funding tobacco prevention efforts, down from 13th in 2007, according to the Washington, D.C.-based Campaign for Tobacco-Free Kids.
In 2008, the Ohio Tobacco Prevention Foundation was abolished. And in June, Ohio cut funding for several local smoking cessation treatment programs around the state, including grants for Public Health — Dayton & Montgomery County and the Greene County Combined Health District.
Public Health still provides free smoking cessation programming on request.
Greene County will use residual funding for free cessation classes in the fall and spring; thereafter, funding for free classes won’t be available.
The Penn State study, funded through a grant from Pfizer Inc., estimated smoking cessation programs statewide would have a return on investment of $1.41 for every dollar spent.
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