The Indiana cigarette tax increase could provide an additional incentive for smokers to quit, while also providing a much-needed boost to funding public health initiatives.
But the Hoosier legislature should also take this into account: Smoking is legal and should not be forgotten. Too high a tax hike would put an inordinate financial burden on Hoosier smokers, many of whom are struggling financially during the pandemic.
22 health organizations have jointly asked the state to increase the tax on a pack of 20 cigarettes from USD 1 to USD 3. That seems extreme when you consider that Hoosier smokers currently pay an average of $ 5.75 for a pack. Add two more dollars and the cost of $ 7.75 would be made up of 39% excise tax, not to mention the 7% state sales tax.
House Bill 1434, drafted by Rep. Julie Olthoff, R-Crown Point, takes a more sensible approach. It would add $ 1 per pack to cigarette tax. HB 1434 would also impose a tax of 8 cents per milliliter on e-liquids that contain nicotine.
Olthoff’s bill would bring Indiana’s cigarette tax closer to the middle of the Midwestern pack. The Illinois cigarette tax is $ 2.98, while Michigan is $ 2, Ohio is $ 1.60, and Kentucky is $ 1.10. The average state cigarette tax is $ 1.89.
The $ 1 increase in Indiana, which has not levied cigarette tax since 2007, would generate roughly $ 175 million in revenue that could be used for public health, where government spending ranks 48th nationwide. The new proceeds could be used for smoking cessation efforts as well as other health initiatives to combat the pandemic and address the Native American litany of health concerns, including caring for mothers and newborns.
Studies have shown that the cost of a pack of cigarettes may keep some smokers from getting light.
Research published in Epidemiology in 2017 found that a $ 1 increase in the price of a pack of cigarettes resulted in a 20% decrease in cigarette purchases.
The proposed $ 1 per pack increase in the Indiana cigarette tax would cost Hoosier smokers on three packs per week who are currently paying about $ 900 per year to support their habit, an additional $ 160 per year. While this amount wouldn’t break the bank for most, it could be another factor that encourages them to quit tobacco.
It’s about a lot. According to the U.S. Centers for Disease Control and Prevention, more than 1,100 Hoosiers die from the effects of smoking and about 1,400 from the effects of second-hand smoking each year.
The economic cost of smoking is also enormous.
According to the CDC, smoke-related illnesses require nearly $ 170 billion annually for direct medical care across the country. Indiana is more affected than most. Nineteen percent of the adults in Hoosier smoke, above the national average of 16 percent.
Given the staggering costs and need for better funding for Indiana’s public health care, the General Assembly should act decisively to pass HB 1434 and raise the cigarette tax for the first time in 14 years.
The Herald Bulletin, Anderson