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Proposed State Tax On Cigarettes Could Create 12,000 Jobs

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The California Cancer Research Act (CCRA), a statewide June 5 ballot initiative, aims to increase the tax on cigarettes, and a recent University of California, San Francisco (UCSF) study says the initiative would create thousands of jobs and significantly boost the state's overall economy.

If the measure, also known as Prop 29, is approved, state cigarette taxes would increase by $1 a pack, generating an estimated $855 million annually for anti-smoking education programs, medical research and tobacco law enforcement, reports UC Newsroom. Additionally, the tax would create approximately 12,000 jobs and nearly $2 billion in new economic activity in the Golden State. The study says the tax would force Californians to smoke less, thus spend their money in other ways.

Study author Stanton A. Glantz, a professor of medicine at UCSF and director of the Center for Tobacco Control Research and Education based at UCSF, says, "The primary impact to the California economy, besides the effect on health care, is that people will smoke less and send less money out of state." The state's independent Legislative Analysts' Office calculated that the tax could help prevent more than 100,000 smoking-related deaths. California does not grow tobacco or manufacture cigarettes, and about 80% of the money Californians spend on tobacco products is exported to out-of-state manufacturers and farmers.

The measure defines the allocation of funds generated by the new tax as follows: 60% to cancer research and to address other tobacco-related diseases, 20% toward tobacco cessation and prevention programs, 15% toward facilities and equipment for health services and research and 5% to law enforcement to reduce cigarette smuggling and tobacco tax evasion and to administer the tax.

Although the tax would create some retail job loss due to fewer retail sales, the study finds that the loss "would be more than offset by a projected 12,000 new jobs in the California economy as a whole as well as in medical research, construction and other activities directly funded by the CCRA," according to UC Newsroom.

The UC Board of Regents endorsed the initiative in September 2011, giving the San Francisco campus the greenlight to put their resources toward objectively evaluating the measure's impact, as well as school the public in the initiative. A previous UCSF study by Glantz and James Lightwood, associate adjunct professor in the UCSF School of Pharmacy, said that, without the tax, the state's tobacco control program would become less effective over time. The current five cents per pack allocated to tobacco control activities is slowly crumbling along with inflation.

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Comments [rss]

  • And oh yeah...remember Prop. 99. 
    Prop 99 raised cigarette taxes by $0.50 a pack to fund Tobacco Control, right?

    Tobacco control is working, right? The State and Mr. Glantz(sp?) applaud the success of the State's Tobacco Control Program in reducing smoking to a 20 year low of 13% of the Citizens, down from 20% tobacco use back when the measure was passed...

    ...so, with far fewer smokers, why does the State need more money than it is already collecting unjustly from We the Smokers?
    I mean, Tobacco Control is working, right?

  • westlafadeaway

    The $40 extra I would pay per month to yet ANOTHER tobacco tax is $40 not spent on other commerce (times a few million California smokers).  As Tom Waits says "the large print giveth and the small print taketh away".

  • Scott Goddard

    I smoke, and this annoys me. Why should I have to pay more for my bad health choice. Those  Assholes. I should tax their salad or gym membership.

  • Shane

    God forbid it motivates you to make a good health choice...

  • Paul

    Ignoring the article and directly on your comment - smoking doesn't just effect you - and let's forget about second hand smoking too - I'm talking about 2nd hand smelling.

    When I go out with my smoker friends, I have to wear set of "smoking" clothes because anything I wear will wreak of smoke. So YOUR smoking happens to have a direct effect on others close to you, and that's costing us money because smoke has ruined your clothing.

    At least salad/gym doesn't directly effect anyone else - sure people smell like sweat, but it won't stick to your clothes.

  • Um, this is supposed to be A Free Country, Paul
    Seems to me the argument of 'affecting others' is really a matter of who you suck up to.
    I mean, if you have to walk in to it in order to be offended, then...

    We've already pretty much outlawed compulsory exposure to smoking in Public, so the only other way to be exposed to it is to invade someone else's Privacy, right?

  • ValleyTrash

    Paul, are you serious?  Let's all live in a world with no offensive odors, lol.  Get new friends then.

  • westlafadeaway

    Paul you are ridiculous.  Let us all just live in your world please.

  • Paul

    How is that ridiculous? It's a simple thought - something you are doing is directly effecting others.

  • Shane

    By all means, cigarettes should always remain legal, but they really should be a luxury good and should be taxed as such. Cigarettes provide absolutely zero benefits to society, the environment, or even the user; in fact, the product actually causes problems for people who choose not to smoke.

    Therefore, it only makes sense to tax it as heavy as possible, until its use diminishes to a small sector that can afford the high price. You can head to any patio at a bar during the night or even walk a busy street in Los Angeles and you'll observe that cigarettes are still common among the masses. This is probably an obvious sign that cigarettes aren't taxed high enough.

    By all means, I think tobacco and several other drugs should be legal, but people need to be self-aware of the burdens they cause and a good way of doing this is taxing them.

    I support any additional taxes on tobacco, at least until the user-base noticeably decreases.

  • In other words, you want the money for the monkey, right?
    But I didn't agree to give it to you, right?
    You want the money for the monkey to pay for research that you yourself refuse to pay for, and that's right.

    As for 'preventing 100,000 deaths from Cancer', I hope people realize that the figure of 100,000 deaths is based on an entire lifetime of 85+ years out of a California smoking population of more than 3.6 Million Citizens who will Not Die From Smoking-Related Cancer.

    The U.S. Government states the average lifespan of an American Citizen is approx. 77.9 years.

    I think it's time for We the People in The First Person who smoke to declare Our Rights to acquire and possess Property and Happiness as Guaranteed by Our State Constitution, against the slovenly assault against tobacco being waged by third-party jackals and Our Representatives(?) who spin the research speculations about Cancer until there is no truth given the hysteria. 
    Let me put it this way. How can you claim to know what you are talking about when you also claim to need research money?
    Because there are other factors involved in the smoking-related death rate, not just smoking, else the lifetime Cancer mortality from Smoking would be and should be infinitely higher, at the level of a clear and present danger, than the figures presented by these 'concerned researchers'.

    Cancer is a horrible disease. We shouldn't allow it to be a tool of pimps.

  • AudreySilk

    This just drives me crazy.  Someone deciding for someone else what is a benefit and what isn't.  Some people get great pleasure from a cold beer on a hot day or at the ballgame.  I hate the taste of beer.  Am I now the arbiter for what does and doesn't bring someone else this benefit ("pleasure") because **I** don't find anything worthwhile about it???  And does everything everyone does have to take "society" into account??  What benefit is drinking a beer to society? Let's all live in a commune, share our food and throw all our money into one pot.  That's what deciding things based on "benefit to society" means.  Nothing private.  Finally, to say a product should remain legal but want to tax it to a point where people can't afford it is wanting DE FACTO "illegal."  You contradict yourself.

  • Shane

    First off, I didn't say it should be illegal. Second, it is a selfish and incorrect mentality to think cigarettes only affect the smoker. There are environmental costs and health problems indirectly resulting from smokers. Logically, these costs should be off-set through the form of taxing the product, so people who don't smoke cigarettes aren't left footing the bill. Give me one reason how smoking cigarettes benefits anyone other than the tobacco companies? It's not about taking society into account on every issue, but rather address issues that attract a large demographic and cause a noticeable problem, such as cigarette smokers.

    I'm not advocating that cigarettes be taxed into oblivion, but they really should be a premium / luxury product through a fair tax. I don't think the aforementioned $1.00 increase described above is unreasonable.

    I think any product that affects other people in a negative fashion should be taxed in accordance with the inherent cost. We deal with alcohol through law enforcement, DUIs, and a premium cost at bars. Marijuana, if it were legal, should logically have less taxing than cigarettes, since there are less health and environmental hazards. So on and so forth...

  • AudreySilk

    First off, I explained how you said -- without saying it -- that tobacco should be illegal.  To make it prohibitively expensive (50 cents yesterday, a dollar more today, two dollars more tomorrow -- see NY -- where does it stop?) is a form of illegality.  So you cannot argue pro legality while supporting a measure to make it near impossible to get.

    I've also said that all you need is MY word that I retain a benefit from smoking.  **I** get pleasure from it.  How dare you argue with me otherwise.  You going to tell me what should make me mad or sad or next?  PETA gets real mad and sad at animal slaughter for food.  I don't.  But I don't demand they don't feel the way THEY feel as you'd like to demand that I accept your definition of "benefit" on a personal level.

    Not even the garbage Glantz is peddling says the tax has anything to do with the so-called "secondhand smoke" issue (a debate for another day) that you've somehow managed -- all on your own -- to extend it to.  Glantz's rationale is all about the smoker.  If I am sitting in my private home that I live in alone with no one else "exposed".... **I'm** being taxed.

    To quote the non-partisan Congressional Research Service -- an arm of Congress -- the greatest transfer of wealth is from smoker to nonsmoker.  We ALREADY subsidize nonsmokers in hundreds of ways.  

    Finally, your alcohol analogy fails.  People can drink at a tax rate that is close to most other products.  Comparing an extreme tax on one "sin" product to law enforcement on another "sin" product is not analogous.  People can still buy a drink at a "normal" rate of tax.  People cannot still buy a pack of cigarettes at a "normal" rate of tax.  May I remind you, the issue is TAX.

  • Shane

    Okay, maybe I used a bit of hyperbole by saying that it should be taxed until the user-base decreases. Rather, I think it should be taxed to off-set any costs on society, whatever percentage this may be, factoring in inflation. The percentage breakdown in the articles seems logical to me.

    I am not arguing that you get pleasure from cigarettes.
    Listen... I enjoy single-malt Scotch Whiskey. I also enjoy Lobster. However, I can't afford either on a regular basis, so  they are only occasional pleasures.
    Why do you think you are entitled to affordable tobacco on a frequent basis? It certainly isn't a necessity for living.

    If you can't afford your addiction, you should've considered the long-term cost.

    You may be considerate by smoking alone in your apt., but you also might not be representing other smokers. You have the right to not smoke, if you are feeling unfairly targeted. If everyone used smoke-free tobacco products, then there would be less of a need for the tax, but this obviously isn't the case.

    Part of the reason the taxes exist, is because the tobacco companies are in a position where they are not pricing their products as a luxury item because they benefit from return customers, due to addiction. The tobacco companies know they have to keep their product cheap enough to form a sustainable addiction. The taxes take the industry's lack of regulation into account and diverts the raised funds towards better causes in this particular case.

    People can still buy cigarettes at a "normal" tax rate via the black market, but this is a separate issue experts are still trying to resolve, as in the case of NY. However, the tax would deal with buyers who are looking to conveniently buy the cigarettes in California, so it still effective in raising some funds.

  • AudreySilk

    Shane, you're making things up as you go along.  Perhaps you've convinced yourself of these things but that still doesn't make them correct.

    The cost of your whiskey and lobster is due to what it costs to provide the product from start to finish. That start to finish process is way cheaper for tobacco.  Again, the issue here is tax.  The price of your lobster is not TAX except for normal sales tax.  The price of a pack of cigarettes is MORE tax than the price of the tobacco!  You tell me what other product that is sold in this country has an amount of tax higher (and I mean more than 50% higher) than the actual product itself. Tobacco IS affordable all on its own.  Every person in this country is "entitled" to not be ripped off by government and to pay a FAIR price.  If that means your lobster is higher and my pack of cigarettes isn't, well, that's just life.

    Government adds the tax because a legal and private company won't price their product beyond what it costs to make and distribute and rightfully make a profit???  Is THAT what you just said???  That there's some govt. rule somewhere (please find it for me) that determines what's a "luxury" product and what isn't and sets economic lines based on that??  Cars are not necessities.  Public transportation (in the realm of "environmentalism") fills the need.  How come there's no exhorbitant tax on cars?  Because your making this stuff up.
     
    And again, you've elected yourself arbiter of what is "necessary."  Nothing but soy and water is "necessary" to live. By your logic -- if you are principled -- you'd have to agree then that everything but soy and water is at the mercy of SOMEone (who? a dictator?) determining what someone can have, and at what price, based on "necessity."  

    I never said I smoked alone in my home as some form of courtesy.  It was an example to refute your "the tax is to pay for others..."  I won't repeat it because I've gone on long enough and it can be found in my previous post.  In fact though, I have no qualms about smoking anywhere indoors where it hasn't been banned by law and reject outdoor bans completely.  I will smoke ANYwhere outdoors regardless of law. 

    Uh huh, I see, I "have the right NOT to smoke if I'm feeling unfairly targeted."  So set up a target and then tell them if they want peace they can just conform to the will of those who set up the target?  There's a word for that -- well, two:  Dictatorship and Discrimination.  Nice vision for the USA you've got there.

    You sound like an otherwise civil guy.  I'm begging you to rethink your position. None of this stops at smoking. 

  • ValleyTrash

     Why do you want to control people's lives so bad?  People know smoking is not beneficial to them and they don't need these ridiculous taxes to tell them that.  Besides, the politicians know that this is just another revenue generating scheme. Just because you disagree with a practice that a certain amount of the population enjoys doesn't make it right to tax it into oblivion.  This country used to be a place where people had more freedom to do what they wanted even if others disagreed with them.  Now we're becoming and oppressive society with an overabundance of laws.  It's really sad to see.

  • ValleyTrash

    Seriously, enough with all of the tobacco tax crap.  It's not going to create jobs or go to cancer research.  It's just a scam like all the others.   Idiot voters will vote for it thinking they're making a difference but they're just a bunch of dumb sheep who can't figure out how it all works.  Smokers are the acceptable class to abuse and demonize these days and it's just plain disgusting.  I don't smoke cigarettes but I do enjoy cigars.  I know I would be pissed if some busybody do-gooder with their nose in the air wanted to tax something I found enjoyable. 

  • AudreySilk

    Stanton Glantz is the king (the father) of anti-smokerism.  There is no question that he has an agenda.  If a tobacco company released a study favorable to them everyone would be screaming "fix."  The messenger here is no different, only that he is on the other side.  On that basis any paper with Glantz's name on it deserves the EXACT same amount of skepticism as any put out by the tobacco industry.  An honest assessment would be one based on the data and methodology and not the messenger.  In this case, Glantz fails again.  So many variables either cherry-picked or ignored.  But not even that matters anymore.  The GREATEST offense is the advancement of the idea that an adult making a legal lifestyle choice should even be subjected to this economic analysis for the purpose of manipulating how a free adult should spend THEIR money.  Are we now at the mercy of busybodies and government to enact measures that force "we the people" to spend our money in the way they APPROVE?   Hey, maybe government and activists think money "we the people" are spending on coffee everyday would be better spent on cars in order to keep the auto industry going.  Pick any number of unapproved of personal choices and any number of government-backed fiscal interests and you have hundreds of combinations.  The point is that the very idea is wrong no matter WHAT tortured figure Glantz or anyone else arrives at.

  • The CCRA sounds like another "let's hire some more state workers (i.e. union)" money pit to me.

    What happens when people do decide to smoke less or quit altogether?  Do these jobs just magically disappear?

    I certainly wouldn't want my livelihood based on someone's continued dependency to tobacco.

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