How much is protecting tobacco worth to state?
by Melissa Dillmon and Matt Mumber
Feb 10, 2010 | 2073 views | 9 9 comments | 12 12 recommendations | email to a friend | print
Though we believe that raising taxes should always be a last resort, a guest column, “Using smokes and mirrors to resolve Georgia budget woes,” by Frank Stephenson (Rome News-Tribune, Feb. 4) contains inaccuracies and fails to fully examine what is at stake this year with Georgia’s budget and health-care system. In fact, perhaps the question isn’t really if we want to increase the tax on tobacco, the question is, who and what are we willing to sacrifice in order to protect tobacco in Georgia, which already has the 46th lowest tobacco tax in the country.

For perspective, let’s consider that the seriousness of the deficit in the state budget has already led to teacher furloughs, the prospect of releasing some prisoners early, increasing class sizes, potentially slashing two weeks off the end of the school year and a legislative proposal to tax hospitals. Would we really tax hospitals before we would tax tobacco? Perhaps more troubling is that even after these massive cuts, Georgia is still facing a budget hole of almost $l billion this year, and double or triple that in the next fiscal year which begins this July. The Commissioner of the Department of Community Health recently testified that without “new revenue,” the state would also be forced to slash reimbursement for Medicaid providers by another 16.5 percent, on top of the 6 percent cut already incurred. As doctors, we can tell you that this would devastate Georgia’s health-care infrastructure statewide. Many providers-would no longer not be able to afford to see Medicaid patients, who in turn would likely show up at the very hospitals that are set to be taxed in lieu of tobacco.

Also contrary to the authors claim, most any economist will also tell you that a tobacco tax is one of the most reliable and predictable sources of revenue out there. It is more predictable than sales taxes, income taxes or property taxes. In fact, 46 states have raised their tobacco tax rate since 2002 and in each and every case, revenue has gone up and tobacco use has gone down.

A revenue estimate generated by the governor’s office last year indicated that even after accounting for cross border sales, internet sales and smoking declines, a $1 dollar tobacco tax increase would generate at least $350 million per year — an estimate that many regard as extremely conservative. This effect has already been proven in Georgia. When we last increased our tobacco tax from 12 cents per pack to 37 cents per pack, our annual revenue from tobacco jumped from $79 million to $226 million per year — despite people quitting smoking and the so called internet and cross border sales losses.

Most importantly though, when tobacco use declines, so do cancer rates, youth smoking rates, heart attacks and a host of other debilitating health conditions. As doctors, that is what we care about most. It makes you wonder why Georgia would be so interested in protecting tobacco. We hope that our fellow doctors and community members join us in asking our state legislators to not sacrifice schools, good health-care, public safety, students and others, just so that we can have the cheapest cigarettes in the country.

Melissa Dillmon, M.D.

Matt Mumber, M.D.

Rome

Comments
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TakesItNoMore
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February 15, 2010
RealEstateMystic

Cigarettes are fourty two dollars a carton, just how much higher should they be taxed to where it would be fair to people that don't smoke and won't be paying any taxes on them?

RealEstateMystic
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February 15, 2010
smokedbacon: Nobody is proposing to "tax tobacco out of existence," for the very reason you point out, that doing so would cut off a valuable source of potential tax revenue. The point is to tax tobacco just enough to be a disincentive for some while still serving as a source of tax revenue. In addition to being a fact of life, taxation is an art, which is why lawmakers are constantly fiddling with them.

smokedbacon writes: "Perhaps it is time for health care reform."

Ya think? Maybe next year? Maybe never? If you don't already see that healthcare reform is something that needs to be done with all deliberate speed -- emphasis on deliberation AND speed -- you are too slow-moving to be on this road.
smokedbacon
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February 15, 2010
As per the story in part " As doctors, we can tell you that this would devastate Georgia’s health-care infrastructure statewide. Many providers-would no longer not be able to afford to see Medicaid patients, who in turn would likely show up at the very hospitals that are set to be taxed in lieu of tobacco." If raising taxes on tobacco is such a great idea why are states tobacco taxes declining? Oh the lets tax tobacco out of existence idea has draw backs. If the crusade to stop tobacco related illnesses what will the medical industry do for profit? If the so called billions in medical cost from smokers dries up will hospital close because of a lack of customers as per the promises of the anti smokers? Will not hospitals then jack up prices like the utility companies do under the excuse your not using enough?

Perhaps it is time for health car reform, call it what it is, a industry that should be taxed with prices comparatively advertised, a correct estimate (like car repairs) before using services. No more I know your in pain your under sedation sign this contract that gives us a blank check to take everything you have ever worked for away from you in a few hours.

iKnowIt
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February 12, 2010
prove that the smell coffee can give you cancer and you may have something there. ;)
TakesItNoMore
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February 12, 2010
To Voter

The nasal spray was given to her while she was in the hospital.

To iknowIt and Voter

Every store I go into I haved to gag on the smell of coffee AND it's stench sticks to my clothes, I wonder if I can start a war to tax coffee out of existence? NO, I don't have the influence on politicans that our doctor friends have.

Quote from the letter

Also contrary to the authors claim, most any economist will also tell you that a tobacco tax is one of the most reliable and predictable sources of revenue out there. It is more predictable than sales taxes, income taxes or property taxes. In fact, 46 states have raised their tobacco tax rate since 2002 and in each and every case, revenue has gone up and tobacco use has gone down. END QUOTE

Coffee is a drug, I bet more people drink coffee than there are people that smoke, tax coffee like they have cigarettes. Coffee AND Alcohol is reliable and predictable source of revenue because of all the caffeine and alcohol addicts, they have to have their alcohol to wine and dine at all the VIP dinners and business deals, Etc. then the next morning they have to have their caffeine fix to half way function again. How reliable and predictable would these addicts be for a source of revenue??? You won't hear any of these caffeine and alcohol addicts jumping on the band wagon to tax these two items because they are necessities to them.

iKnowIt
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February 12, 2010
"admitt it, it's all about, you, non smokers having to smell a puff of smoke"

to me, you are 100% right! I do believe that everyone has the right to do whatever they want to their bodies...that said, if you are drinking wine at the next table or if you are fat and sitting at the next table, it doesn't affect me. If you are puffing away on your cig, it DOES affect me, and everyone else in the area. If it were just a puff of smoke, fine, but it's not just a "puff" of smoke. It's constant and it sticks to my clothes and gets into my lungs (and those of my children) and it sticks to everyone. There are certain people we no longer even visit because my children come from their homes smelling like an ash tray. It's my right to NOT have to smell it, as I choose NOT to smoke. If I eat a burger, the fat doesn't drip off of me and cling to you...if it did, no doubt you (in general, not a particular "you") would have a problem with that, just as a lot of non-smokers do with smokers.

IMO there IS a difference in smoking, compared to sugar and alcohol.

Now, that said, will a huge tax stop people from smoking? Of course not. When my husband and I were dating, his mother lost her job and his stepfather was working lots of extra time to make up for it. In sitting with her as she made up her grocery list, she wrote down her cartons of cigarettes and when he said he wanted a case of beer that week so he could have one or two after his 12-14 hour workday, she informed him that no, his beer wasn't a "necessity" and they couldn't afford it. (her cigs were, to her, very much a necessity, which is my point) If people are addicted, they will pay anything they have to get that "fix", be it an illegal drug or a legal one.
TakesItNoMore
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February 11, 2010
I am a smoker and feed up with you people that thinks a cigarette tax is going to solve all of your problems, ( admitt it, it's all about, you, non smokers having to smell a puff of smoke) Why do you doctors not tell us about Alcohol and Sugar, tell us about the damage they do to us. You won't go there, because if you started war on alcohol and sugar, you and your doctor friend would be looking for a job outside the medical field because you would be without a job like a lot of other Americans.

A doctor or two has wrote letters to the editor as to how smoking has put a strain on the medical proffession, HERE is something you doctors want touch with a ten foot pole, You won't talk about how all the illegal people in America is sucking your system dry because it might make all of you look cold hearted, Well I think it is cold hearted to charge (AFTER Medicare AND Insurance) a 70 plus year old woman two hundred and twenty five dollars for a two shot bottle of nasal spray. NOW TELL ME, JUST HOW MUCH TAX WILL YOU BE PAYING IF YOU CAN GET SONNY TO PASS A NEW TAX ON CIGARETTES ?

Sassy13
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February 11, 2010
What an innovative concept! Tax something that is 100% personal choice and not a necessity. Make a positive impace on many levels without having to legislate morality or parenting or all of the other issues in our lives that the government feels that we cannot deal with without its help. Thank you Dr. Dillmon. Would you consider running for office?
RealEstateMystic
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February 11, 2010
Common sense is so rare in these pages these days that I almost forgot this letter was written in Rome, GA.
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