Cigarettes and taxation in USA

St Z.

Order the writing of a tailor-made Economy general Essay

Free quote online

Essay Format .doc

Cigarettes and taxation in USA

Download

Read an extract

Themes

Cigarettes, taxation, taxes, taxing authority, USA, New York, New York city, Fleenor, current tax, black market, pollution, Lindblom

Reader
Abstract
Contents
Extract

Abstract

With a country that is plagued with many preventable illnesses and people that are leading seemingly unhealthier lifestyles by the day, it is no surprise that cigarettes contribute much of the nation's ills. Due to the damage caused by tobacco use; especially cigarettes, such as the increased risk for cancer, heart disease, air pollution and second-hand smoke, as well as being expensive for public health services, NYC is joining many other cities and states around the country to tax cigarettes and tobacco products. The intention is to curb the amount of smoking, raise the age of people starting to smoke, and discourage young adults and teens from starting. The added economic benefits of taxing this vice is that it increases revenue for the city and state and can offset the effects of smokers on the health care system and other issues that arise from the use of tobacco products.

The use of cigarette taxes in New York City and other locations
The social implications of cigarette taxes
The revenue for the taxing authority

Get this table of contents for free after login.

Extract

[...] With the benefits that occur with the cigarette tax, there also come some issues which must be dealt with as they affect the revenue that states and cities can raise. Chief among these include cigarette smuggling from states that do not have high cigarette taxes, and the black market which has been created because of New York's high taxes. According to Patrick Fleenor, of the Cato Institute, “over the decades, a series of studies by federal, state, and city officials has found that high taxes have created a thriving illegal market for cigarettes in the city. [...]

[...] Cato Institute . "How Cigarette Tax Evasion Hurts Everyone." Department of Health . Lindblom, Eric. "TOBACCO TAX INCREASES ARE a RELIABLE SOURCE." Tobacco Free Kids. Campaign for Tobacco Free Kids . "PROGRESS STALLS IN FIGHT AGAINST SMOKING IN NYC." Department of Health . "STATE CIGARETTE EXCISE TAX RATES & RANKINGS." Tobacco Free Kids. Campaign For Tobacco Free Kids . [...]

[...] The use of a cigarette tax has greatly helped both New York City and other locations around the country and continues to be a policy that is supported by most people, not only for the health benefits that it provides city dwellers, but because it provides money for programs which are beneficial to the community and to target areas of the population which are sometimes neglected. Finally, the increased taxing of cigarettes has helped the government by reducing costs in other areas. Before July 2002, the tax on cigarettes was extremely low, not only for our current tax standards, but also for the standards of other states and cities. Whereas the tax on a pack of cigarettes in New York City was previously eight cents, after July 2002, the tax was increased to the current level of $ 1.50 per pack (NYC DOH). [...]

[...] The cigarette tax thus saves money on healthcare which provides benefits to people and the economy. With healthcare costs at record high prices, the fewer people who develop conditions from smoking related illnesses, the lower the burden is on the public. Likewise, in the private sector, the medical insurance rates go down as insurance companies no longer have to charge higher premiums to offset the costs they incur to provide healthcare services to smokers. The lower premiums that are carried to the insurance consumer results in more disposable income, thus smoking reduction through taxation should help the economy by creating economic growth through personal investment and increased consumption. [...]

[...] Combined local and state taxes are now in New York City (Fleenor). Obviously the city tax is no small increase, as it was more than eighteen times higher than before, while the New York State tax has not kept up the pace. Even with such high rates, New York is still not the most zealous government on cigarette taxing. Compared to other states, New York does not have the highest taxes on cigarettes. In the U.S., the state average of cigarette taxes is $ 1.03 per pack, yet not all state have the same tax rate (Freetobaccokids.org). [...]

doc