Tobacco TaxesLocal Taxes in Rural Alaska

Why establish a tobacco tax?

Prevent youth initiation Reduce adult tobacco use Save lives Reduce health care costs Potential revenue for your community

“It's not a hard concept to grasp -- as taxes on cigarettes goes up, sales of cigarettes go down.”

-Convenience Store News, 2009

Price Vs. Consumption

Youth & Tobacco: We can do better

Tobacco taxes are a best practice U.S. Surgeon General Institute of Medicine Centers for Disease Control and Prevention U.S. Community Preventive Services Task

Force National Association of County and City

Health Officials World Health Organization Economic and public health research

And what do tobacco companies say about taxes?

In their own words…

“It is clear that price has a pronounced effect on the smoking prevalence of teenagers, and that the goals of reducing teenage smoking and balancing the budget would both be served by increasing the tax on cigarettes.”

-Philip Morris, 1981

“Of all concerns, there is one - taxation - that alarms us the most. While marketing restrictions and public and passive smoking restrictions do depress volume, in our experience taxation depresses it much more severely.”

-Philip Morris, 1985

“Together with manufacturers’ price increases in recent years and substantial increases in state and federal taxes on tobacco products, these developments have had and will likely continue to have an adverse effect on the sale of tobacco products.”

-Reynolds American Inc., 2011

What does the research say?

How much tax?

Every 10% increase in the cigarette price

Reduces smoking by: 6-7% among kids 3.5% among young adults 3-5% overall

What kind of tax?

Unit based tax Ad valorem tax (percentage) Weight based

Local tobacco taxes in Alaska

In 2011, three Alaskan communities passed new tobacco taxes

Anchorage ($0.75/pack) Klawock Tribe (insert) Seward (8%)

Potential for Local Revenue

In 2006, The Campaign for Tobacco Free Kids estimated that a $1 tax on cigarettes in Bethel would raise $297,000, result in 23,000 fewer packs of cigarettes smoked and reduce youth smoking by 11.4%.

Who can pass a tax?

City or Tribal Council - Vote of the council

The People - Ballot initiative

The Policy Change Process

Resources

www.TobaccoFreeAlaska.org Tobacco Free Alaska on Facebook The Rede Group - Robb Hutson robb.

hutson@redegroup.co 971-645-0381