From the Bloomington Pantagraph
SPRINGFIELD -- Supporters of a statewide smoking ban say it will save taxpayers money by reducing health care costs in Illinois. But at least one economist says that notion holds as much weight as a flicked ash. Patrick Fleenor, chief economist at the Tax Foundation, a Washington-based educational group, said the state won’t save money and will most certainly lose it if fewer people buy cigarettes. "That’s nonsense," he said of the supposed health care savings. ’’And the reason that it’s nonsense is that smokers more than pay their way.’’
Fleenor said the state will undoubtedly lose money because of the ban and a recent study by the Illinois Department of Revenue appears to back that up. The state tax on cigarettes is 98-cents per pack and, according to state officials, Illinois collected $636 million in cigarette taxes last year. If signed into law, the department estimated that the state can expect the ban to take a $30 million bite out of that.
Wow, a 4.72% percent drop in cigarette revenues?
Or, one tenth of one percent of total revenues? That's an entire 8 hours of state government spending per year!
Did it ever occur to you that selling 30,612,245 less packs of cigarettes per year might be a good thing? Or did it ever occur to you that simply raising the tax on each pack from $0.98 to $1.03 would make up all of that lost revenue and half a million more?
Didn't Philip-Morris give the Tax Foundation a $40,000 "donation" in the mid-90's? Also, aren't they listed in a Philip-Morris document outlining the tobacco industry's plan for "co-op efforts with third-party tax organizations"? Finally, you often quote things from the "National Smokers Alliance", but they're connected with Philip-Morris as well. I'd be more supportive of this "research" if it was coming from independent, third-party sources. Thanks for trying, though.
http://www.prwatch.org/prwissues/2000Q3/junkman.html
"Didn't Philip-Morris give the Tax Foundation a $40,000 "donation" in the mid-90's?"
Philip-Morris is a contibutor to the Tax Foundation. Why wouldn't they be? The Tax Foundation fights high tax rates, including Capital Gains & Dividends Taxes, Cigarette Taxes, Corporate Income Taxes, Estate and Gift Taxes, Excise Taxes, Gasoline Taxes, Gross Receipts Taxes, Income Taxes, International Taxes, Jock Taxes, Lottery and Gambling Taxes and Property Taxes.
If Philip-Morris could sell more cigarettes through lower taxes, why wouldn't they be a contibutor? Their contributions help fight all higher taxes. Is that bad? Why is every organization that receives funding from tobacco companies inherently evil? Fleenor is backing up the State's estimate of lost revenue.
"Wow, a 4.72% percent drop in cigarette revenues?"
$30 million may be chicken feed to you, but it isn't to me.
"Or did it ever occur to you that simply raising the tax on each pack from $0.98 to $1.03 would make up all of that lost revenue and half a million more?"
Higher excise taxes mean fewer Illinois cigarette sales. More cigarette orders for the Indian reservatons. More trips across the border. More bootlegging. Sin taxes don't work.
From the Horse's Mouth:
Uhh, and how much will it save in health care expenses? 1 billion? 10? 100? The lost revenue will be more than made up by reduced expenses.
What's interesting is that smoking bans don't generally reduce cigarette tax revenue. Since 2002, Massachusetts has levied a tax of $1.51 per pack.
In April of 2003, prior to the implementation of a state-wide smoking ban, Massachusetts DOR collected $30.8MM in cigarette taxes.
In October of 2003, $34.8MM.
In April of 2004, $34.5MM.
In October of 2004, $34.3MM.
In April of 2005, $33.0MM.
In October of 2005, $34.8MM
In April of 2006, $33.8MM.
In October of 2006, $38.4MM.
In March of 2007, $35.0MM. (Sorry, April isn't available yet.)
Now, from that data alone, can you tell me when the smoking ban was implemented?
Highlight the end of this line to get the answer. -------------------------------> July 2005.
Interesting case study, huh.
"Uhh, and how much will it save in health care expenses? 1 billion? 10? 100?
I don't think anyone really knows. People quit smoking, people live longer, healthcare costs increase.
Department of Public Health, Erasmus University, Rotterdam, the Netherlands.
BACKGROUND: Although smoking cessation is desirable from a public health perspective, its consequences with respect to health care costs are still debated. Smokers have more disease than nonsmokers, but nonsmokers live longer and can incur more health costs at advanced ages. We analyzed health care costs for smokers and nonsmokers and estimated the economic consequences of smoking cessation.
RESULTS: Health care costs for smokers at a given age are as much as 40 percent higher than those for nonsmokers, but in a population in which no one smoked the costs would be 7 percent higher among men and 4 percent higher among women than the costs in the current mixed population of smokers and nonsmokers. If all smokers quit, health care costs would be lower at first, but after 15 years they would become higher than at present. In the long term, complete smoking cessation would produce a net increase in health care costs, but it could still be seen as economically favorable under reasonable assumptions of discount rate and evaluation period.
CONCLUSIONS: If people stopped smoking, there would be a savings in health care costs, but only in the short term. Eventually, smoking cessation would lead to increased health care costs.
The study was not funded by Big Tobacco.
Regardless of sponsorship, the New England Journal of Medicine article appears to disagree with the results of your cited study. See
http://content.nejm.org/cgi/content/short/338/7/470
When Illinois and Chicago raised taxes on packs of cigarettes, eggs was probably complaining then about lost revenue. Apparently it did not materialize. And considering the budget of Illinois, 30 million is nothing (unless it affects someone pork).
Eggs, you really do have the weakest arguements on this site, but your entertaining. I am laughing with you, not at you.
I'm laughing at him.
I gotta say, it's interesting to watch how every possible negative is thrown up to fight the smoking ban:
- First, it's trampling on smoker's rights, which exist about as much as non-smoker's rights, and the non-smokers are quite the majority these days;
- then we're looking at "Prohibition on tobacco", which a public ban is not;
- then it was trampling on the rights of small business owners, forgetting that bars and restaurants are already heavily regulated already, and why weren't people complaining about other restrictions before;
- then it was that the state will lose $30 million in tax revenues, which is most liekly not true as smokers have proven time and time again they'll pay through the nose for their habit;
- now we're being told that it will have a huge impact on the cost of health care in 15 years....riiiiight.
I'm sure I'm missing plenty of other poorly-formed arguments against the smoking ban, but this one really sums up the desparation. When a conservative is against something because "you'll be taking away money from the government", you know they're really reaching...
Arvid:
It's both entertaining and sad. I call it tragicomic when I discuss newspapers and their failed approaches.
The difference here is the anti-smoking ban crowd is still actually producing factual material. It's then twisted into a nonsensical, highly amusing "argument."
The newspaper visual crowd simply concocts lies, then chants them long enough to try to make them seem like facts.
Rumor has it that the City Of Champaign will release soon Food and Beverage Tax receipts showing an increase in February over January, despite the blizzard (but 2007 was less than February 2006) and March 2007 was up over March 2006. So much for the argument that the smoking ban is hurting business. Then again, I suppose we should believe the bar owners are reporting higher sales and therefore paying higher taxes because they cheated on the tax returns and underpaid in 2006.
How WILL these facts be spun?
Imagine the saving made on healthcare. Governments will no longer have to spend countless millions on cancel due to smoking and this money could be funnelled elsewhere.
Brad
<a href="http://www.thebestdogfood.info">thebestdogfood.info</a>
Did someone really just argue that people being healthy and living longer is bad because it might increase health care costs?
We should totally kill off more of our citizens. It sucks when people die, but hey, it's cheaper.
xian... I think Brad's post was arguing that the smoking ban would reduce smoking and therefor save money due to less incidents of cancer. Though others on this thread have pointed out that it may have the opposite effect and increase health care costs due to people living longer. I don't think anybody argued that dying earlier is better so much as arguing that the costs for healthcare wouldn't necessarily go down because of a smoking ban. Just my impression.
--
Glock21 Op/Ed
Uhh, and how much will it save in health care expenses? 1 billion? 10? 100? --These are facts?
$24 million to $60 million per year -This is allot of money for the state budget to lose. I can give you a few comparisons; Lincoln halls reconstruction will cost a reported 50 million dollars. I have also been told that the University would accept another 50 million in their budget for next years budget. Tight as the state budget is losing 60 million dollars could have major impact on the local economy. Of course maybe it doesn't affect you directly so you don't care because you won't lose your job.
If the state doesn't exempt the casinos in Alton and the Quad Cities, it's in for a much larger deficit. And an amendatory veto with an exemption for casinos could lead to, what, possibly the return of independence for municipalities concerning the bar smoking issue?
Not much of a stretch, considering only one of the five states bordering Illinois has passed a smoking ban, and the others are not going to soon when they see money spilled into their state. Oh, yeah....there's that budget thing, too.
We would all be better off if state tax revenues from the sale of tobacco dried up to zero by consumption of that carcenogenic product correspondingly drying up to zero.
We could find the revenue elsewhere and save on public funded health care costs.
Why would Eggs Actly want the state tax collection from the sale of this poison to remain high?
Your, Oncologist
"We could find the revenue elsewhere and save on public funded health care costs." is it that you just have not been watching the news, or you know very little about the budget process? The states health care costs are very low, because they just don't pay their bills.
xian... I think Brad's post was arguing that the smoking ban would reduce smoking and therefor save money due to less incidents of cancer. Though others on this thread have pointed out that it may have the opposite effect and increase health care costs due to people living longer. I don't think anybody argued that dying earlier is better so much as arguing that the costs for healthcare wouldn't necessarily go down because of a smoking ban. Just my impression.
Thanks. That helps clarify a little.
I think this is an example of missing the bigger picture though. I would hope we could agree on two basic facts:
1) We have one of the worst, possibly the worst health care system in the world of any country that actually has the technological capability to provide decent health care. I say this because:
A) We spend a lot more.
B) We don't provide preventive medicine.
I really don't care about how it's executed. You could have an utterly free market insurance company/HMO based system for all I care if it works. However, from what I've seen, there's little evidence that the current system can deliver on either cost or citizens' health.
I realize writing this that there are some people reading this who would gladly sacrifice other people's health simply to avoid a cheaper, better performing system that happens to not fit their political ideology. I believe however that they are very few in number, and sorry to say it, but that's madness. It's the kind of logic that had us overthrowing democratically supported leaders in sovereign countries and installing dictators to "promote democracy".
2) We would like for our citizens to live healthy, long and productive lives.
Clearly if we believe this is worth anything at all, we would trade some cost for greater public health.