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Missouri is about to become the favorite state for the supposedly overtaxed smoker. The South Carolina legislature has voted to up its tax rate from seven cents to fifty-seven cents a pack. That will make Missouri, now with the second lowest levy of seventeen cents a pack, the undisputed number one.
Increasing taxes on tobacco is a public policy no-brainer. First, it reduces smoking rates. Economics 101 applies. Raise the cost and consumption falls. That is especially so among price-sensitive teenagers and young adults. Reduce their smoking frequency or, better yet, keep them from starting, and reap the benefits: fewer chronic illnesses, lower health care expenditures, longer lives.
In Missouri, about one in eight teenagers and almost one in three young adults smoke. Both rates are among the highest in the nation. Missouriís overall rate, one out of every four persons age twelve or older, places it third in the country. Low tobacco taxes help keep these smoking rates high. As a consequence, the Centers for Disease Control and Prevention places Missouriís smoking-related death rate ninth in the nation.
Second, tobacco taxes raise revenues for critical state services. Even after discounting for reduced sales, each one penny increase in Missouriís per pack levy would generate over five million dollars. Applying South Carolinaís fifty-cent hike to Missouri would produce two hundred and fifty million dollars annually.
These compelling reasons explain why forty-six of the fifty states have passed over one hundred cigarette tax increases during the past ten years. Over that decade, the average per pack state tax has more than tripled, going from forty cents to one dollar and forty cents. Missouriís major neighboring states all have much higher levies than our seventeen cents. Arkansas is one dollar and fifteen cents per pack, Illinois ninety-eight cents, Iowa one dollar and thirty-six cents, and Kansas seventy-nine cents.
During this same period, Missouri has made two attempts to increase its cigarette tax. Because the Missouri Constitutionís Hancock Amendment requires voter approval, both were statewide ballot measures. In 2006, the proposal was eighty cents per pack. In 2002, it was fifty-five cents. Both were narrowly defeated: fifty-one percent no to forty-nine percent yes.
Why did Missouri say no to higher tobacco taxes when most other states were replying yes? Was it the above average number of no-taxes-nowhere-no time voters in the state? Was it squabbles among proponents about dividing the additional revenues? Was it the well-funded opposition from tobacco companies and cigarette retailers? The probable answer is all of the above.
One hopesómaybe naivelyóthat being at the tobacco tax bottom and near the cigarette-related illness top will stimulate another serious effort to raise significantly levies on tobacco in Missouri. Doing so is smart public policy. Not doing so is just plain dumb.
(The opinions expressed are not necessarily those of St. Louis Public Radio.)
Terry Jones is Professor of Political Science at the University of Missouri - St. Louis.