Our view: Time for Maryland to do the right thing and tax cigars, snuff and other forms of tobacco at a rate comparable to the tax on cigarettes
3:06 PM EST, January 19, 2012
Over the past decade, Maryland has gradually raised its tax on cigarettes to the current $2 per pack, and the results have been striking. Fewer people smoke cigarettes today than before the tax was implemented, and that’s particularly true among high school students.
Yet even as lawmakers acted boldly to reduce cigarette use, they foolishly left alone other forms of tobacco, chiefly snuff, chewing tobacco and cigars. So while cigarettes and what’s known as “OTP” or Other Tobacco Products were taxed at comparable levels in 1999 (36 cents per pack for cigarettes and 15 percent of wholesale prices for OTP), they are far apart today.
The results have been predictable. Increasing cigarette taxes by 555 percent has done wonders for public health, but leaving the tax applied to cigars and the like unchanged since 1999 has only made those tobacco products more popular.
According to the most recent health statistics available, cigarette smoking in Maryland has declined by nearly one-third over that period. But sales (in dollar value) of such products as roll-your-own tobacco, snuff and cigars have grown by 225 percent, 133 percent and 176 percent, respectively.
Fortunately, it appears some in Annapolis have finally taken note of this outrageous disparity. This week, Gov.Martin O’Malley released a budget proposal that would have the General Assembly raise the tax on OTP to what health advocates have been seeking for years — a 70 percent tax applied at the wholesale level.
That, supporters say, would keep OTP on the same playing field as cigarettes and generate somewhere between $19 million and $30 million in annual revenue for the state which is facing a potential $1.1 billion deficit next year.
Tobacco producers and retailers won’t like the tax, but they’ll have a difficult time arguing that OTP deserve special treatment. Experts say all forms of tobacco are considered harmful to human health no matter whether they are smoked, puffed, chewed or otherwise ingested.
Smokeless tobacco, for instance, is often linked to oral and esophageal cancer. Cigar smoke contains higher concentrations of tar and cancer-causing nitrosamines than does smoke from cigarettes, according to the National Cancer Institute.
Tobacco industry lobbyists will likely decry any attempt to raise the tax as anti-business and an assault on struggling mom-and-pop tobacco shops. But the tobacco industry has already declared its war — and it’s on the next generation of Americans.
Already, tobacco producers are devising products with a youthful appeal from flavored cigars to the latest offering currently being test-marketed across the country, dissolvable tobacco that comes in the form of sticks, lozenges and sheets that gradually disintegrate in the mouth.
Raising the price of tobacco has proven to be an effective way to steer people from picking up the habit. And discouraging everyone from using tobacco in any form is always a good idea. Tobacco is linked to an estimated 6,861 deaths in Maryland each year and costs the state an estimated $3.6 billion in health care costs and lost productivity, the American Lung Association reports.
Nor would a 66 percent tax put Maryland in the top tax bracket for tobacco. At least seven states already assess higher tax on some or all forms of OTP including Massachusetts, Alaska, Florida, New York, Rhode Island, Vermont and Washington.
Admittedly, a lot of states still tax cigarettes at a much higher rate than they do OTP. The reasoning involved is difficult to fathom, but it could be that some lawmakers aren’t aware of the hazards posed by cigars, snuff and other forms of tobacco. Some may have assumed they were less addictive or harmful. The relatively modest revenue involved may have deterred others from bothering with them.
But purely from a public health perspective, the tax disparity makes no sense. Teenagers who may find cigarettes too pricey at $6 per pack may be more inclined to pick up a small cigar that costs a fraction as much.
That’s unacceptable. Whether the revenue from a higher OTP tax helps balance the state budget is unimportant. The state can’t continue to give such a big break to tobacco simply because it doesn’t come in the form of cigarettes. It’s foolish public policy, and it’s particularly destructive to those youngsters the industry so obviously wants to hook on its deadly products.
Last modified: January 20, 2012