Dr. Richard Feldman: Increasing cigarette tax would support public health

In various state health-ranking reports, Indiana is consistently among the unhealthiest states by almost any measure, including chronic disease, overall health and life expectancy. According to the American Lung Association, our state’s maternal smoking rate is well above the national average, and our adult smoking rank is eighth-highest nationally. One in five Hoosiers, 11,000 annually, die as a result of smoking. Tobacco plays a large role in our miserable state of health.

Historically, public health funding has been a low priority for the Indiana General Assembly. But recently, I have been encouraged by its support of public health. Since 2021, the Legislature has allocated an additional $275 million to address Indiana’s most pressing public-health challenges. Let’s add to this accomplishment by increasing the cigarette tax.

The Legislature has repeatedly failed to increase the cigarette tax; the last increase occurred in 2007. The political influence of the tobacco industry runs dark and deep, and legislators need to push big tobacco aside. In fact, it would be a political win. A 2018 survey conducted by Bellwether Research found that nearly two-thirds of Indiana voters favored a $2 cigarette-tax increase if just part of the revenue went to tobacco-prevention programs.

Indiana’s cigarette tax is 99.5 cents per pack (39th-lowest among the states). The national average is $1.96. And look at our surrounding states: Michigan’s cigarette tax is $2.00 per pack; Ohio’s is $1.60; Illinois, $2.98; Wisconsin, $2.52; and even the tobacco state of Kentucky is $1.10 per pack. These states understand that increasing tobacco taxes discourages smoking and youth initiation, and provides increased
tax revenue.

According to the Campaign for Tobacco-Free Kids, increasing cigarette taxes, despite reducing smoking rates, has never demonstrated a point of diminishing cigarette tax revenue even in high cigarette-tax states—New York is the highest, at $5.35 a pack. Tobacco taxes are a stable source of state revenue.

Although estimates vary, a $2 increase per pack would generate about $360 million annually. Increased taxes on vapes should also be considered given the high rates of use, particularly by youth.

Funding for Medicaid and non-health-related uses will undoubtedly be beneficiaries for increased cigarette taxes, but increased funding for the state’s languishing tobacco prevention and cessation program is essential.

Indiana is mired in economic losses due to smoking. Tobacco use results in $7.5 billion in lost productivity each year, $3.4 billion in health-care costs, $634 million in state Medicaid costs, and an additional business expenditure of $5,800 for each smoking employee. An unhealthy workforce is a drag on business and a barrier for economic development.

According to the World Health Organization and the National Cancer Institute, raising the cost of tobacco is the single most effective strategy for reducing tobacco use. The general consensus from multiple sources is that, for every 10% increase in the cost of cigarettes, youth smoking is reduced 7%; adult smoking 2%, and total consumption 4%.

Some regard the cigarette tax as regressive, disproportionately affecting low-income families. With their high rate of smoking, they have the most to gain in improved health. And without buying cigarettes, they will have more money to spend on life’s essentials.

It’s a great time to increase the cigarette tax. This is a legislative budget session in a non-election year. The increase would mitigate difficult budget-reduction decisions that loom in the face of a huge Medicaid shortfall.

A long-overdue increase in the cigarette tax would be big medicine for Indiana’s health and economics.•

__________

Feldman is a family physician, author, lecturer and former Indiana State Department of Health commissioner for Gov. Frank O’Bannon. Send comments to [email protected].

Click here for more Forefront columns.