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New Report: Increasing Mississippi's Cigarette Tax Will Reduce Smoking, Save Lives and Save Money
Date:6/23/2008

$1 Increase Would Generate More Than $150 Million in New Revenue for Medicaid

WASHINGTON, June 23 /PRNewswire-USNewswire/ -- As Mississippi's leaders begin working next week to resolve a projected state budget deficit, a report released today finds that a proposed $1 cigarette tax increase would raise more than $150 million in new revenue to fund Medicaid and also drastically reduce youth smoking, cause many smokers to quit, reduce tobacco-related health care costs and save thousands of lives.

The 32-page report by the Campaign for Tobacco-Free Kids - titled "Tobacco Tax Benefits for Mississippi: Reducing Smoking, Saving Lives, and Saving Money" - finds that a $1 cigarette tax increase would:

* Prevent more than 45,000 Mississippi kids from becoming smokers;

* Spur 26,000 current adult smokers to quit for good;

* Save more than 21,000 Mississippi residents from premature, smoking-caused deaths;

* Raise more than $150 million in new revenue;

* Produce more than $1 billion in long-term health care savings, including $208 million in Medicaid savings.

The Mississippi Legislature returns to Jackson next week for a special session to resolve a $90 million budget shortfall triggered by a Medicaid funding crisis. The Mississippi House has proposed increasing the state cigarette tax by $1 per pack, while Governor Haley Barbour's plan calls for increasing the hospital bed tax - the cost of which could be passed on to patients and cause health insurance costs to rise, according to news reports.

"This report provides powerful evidence that increasing the cigarette tax by $1 will improve both the physical and financial health of Mississippi for generations to come," said William V. Corr, Executive Director of the Campaign for Tobacco-Free Kids. "We strongly urge Mississippi leaders to pass this life-saving measure and dedicate a portion of the new revenue to the state's tobacco prevention efforts."

Mississippi's current cigarette tax is 17 cents per pack, the third lowest in the nation and well below the statewide average of $1.16 per pack. Since 2002, 44 states and the District of Columbia have increased their cigarette excise taxes 80 times. Twenty-six states and DC currently have cigarette tax rates of $1 per pack or higher, and 11 states have a cigarette tax rate of $2 or more.

The evidence is clear that increasing the price of cigarettes is one of the most effective ways to reduce smoking, especially among children. Studies show that every 10 percent increase in the price of cigarettes reduces youth smoking by about 7 percent and overall cigarette consumption by about 4 percent. In recent years, every state that has significantly increased its cigarette tax has enjoyed significant increases in revenue even while reducing smoking.

Tobacco use is the leading preventable cause of death in Mississippi, and the United States as a whole. In Mississippi, tobacco use claims more than 4,700 lives each year and costs the state more than $719 million annually in health care bills, including $264 million in Medicaid payments alone. Government expenditures related to tobacco amount to a hidden tax of $561 each year on every Mississippi household. In Mississippi, 19.2 percent of high school students are still current smokers, and 4,900 more kids become regular smokers every year.

For a copy of the report, please visit: http://www.tobaccofreekids.org/pressoffice/mississippireport2008.pdf


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SOURCE Campaign for Tobacco-Free Kids
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