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Learning Objectives
At the conclusion of this presentation attendees will be able to:
- Attendees will be able to explain the implications of tax evasion and describe what types of smokers are most likely to avoid paying higher taxes.
Key Points: From June 3, 2008 to July 1, 2010, state and federal cigarette excise taxes increased by $3.47. New York State’s cigarette tax increased by $1.25 on June 3, 2008 and $1.60 on July 1, 2010. From the year prior to the 2008 tax increase to the year following the 2010 increase, the price per pack reported by smokers increased from $4.96 to $8.32. However, smokers who purchased cigarettes from low- or un-taxed sources paid $4.60 in the year prior to the 2008 tax increase compared to $5.43 for those who did not. In the year following the 2010 increase, smokers who avoided taxes paid $7.36 compared to $9.45 for smokers who did not avoid the tax. Overall we estimate that New York State lost approximately $600 million in lost revenue in 2010 as a result of tax evasion.
Educational Experience: Although cigarette excise taxes are an effective tool for reducing smoking among adults, smokers, especially heavy/addicted smokers, seek out ways to avoid higher taxes. Tax avoidance reduces the public health impact of higher cigarette taxes.
Benefits: The presentation can provide valuable information about how smokers respond to large cigarette excise taxes.