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Posted on 09/17/2002 7:29:13 AM PDT by SheLion

KENTUCKY SMOKERS’ CONTRIBUTIONS TO THE STATE ECONOMY - 2002

(Please keep in mind that the excise and sales tax amounts are latest estimates and
are likely to change slightly late this year or early next year.  The plan is to issue a revised sheet at that time.)

Kentucky smokers comprise only 30.9% (1) of the adult population in the state. Here is what they already pay because they choose to buy a legal product:

Smokers Pay Excise Taxes (2) $ 17,114,768

Smokers Pay Sales Taxes (2) $ 97,156,530

Smokers Pay Tobacco Settlement Payments3 $126,020,729

$240,292,027

Smokers' Economic/Tax Profile

Income

Kentucky smokers' median income 2001(1) $ 29,945

Kentucky State Tax Liability for Median Income Smoker (4)

Annual state income tax liability for a couple $1,452

Annual state income tax liability for a couple with two children $1,412

Smoker Excise Tax/Sales Tax/Tobacco Settlement Payments Liability (5)

Total average paid per Kentucky smoker in excise and sales taxes $ 121

Cost per Kentucky smoker for settlement payments to Kentucky $ 134

Total annual payments to Kentucky per smoker $ 255

Kentucky Smoker Facts (6)

Total smokers' payments in FY2002 to Kentucky were more than three times as large as state excise taxes on alcoholic beverages in 2001 ($69.9 million).

Smokers' payments were more than twice as large as occupation and business license taxes ($117 million).

Kentucky smoker payments were larger than net Kentucky Lottery revenues of $172.7 million (FY2002).

The total amount paid by smokers in Kentucky could cover FY2001 operating budget expenditures for:

The School Facilities Construction Commission ($72.1 million) AND Natural Resources and Environmental Protection ($164.7 million)

OR

Child Care ($124 million); AND Community Mental Health and Mental Retardation Services (combined $112.5 million)

OR

The Department of Public Health ($213.5 million)

In 1997, smokers provided 75,689 jobs that paid an additional $81 million to the state in personal and corporate income taxes. (7)

TOTAL SMOKER CIGARETTE PAYMENTS TO KENTUCKY:

Per year: $240,292,027.

Per day: $657,884.

Per hour: $27,412.

Per minute: $457.

Per second: $8.

CIGARETTES DON'T PAY TAXES - KENTUCKY SMOKERS DO!!

1. Centers for Disease Control's Behavioral Risk Factor Surveillance System, 2001

2. Orzechowski & Walker, Arlington, Virginia; latest data from state revenue department

3. PriceWaterhouseCooper

4. State annual income tax liability from PayBreeze software of General Programming, Inc., San Jose, California, which utilizes the Exact Calculation Method.

5. U.S. Census Bureau, 2000 Census and Centers for Disease Control's Behavioral Risk Surveillance System, 2000

6 . U.S. Census Bureau, the Kentucky Office of the State Budget Director, 2000-2002 Budget of the Commonwealth, Operating Budget Vol. 1 (B and C), on line at http://www.osbd.state.ky.us/publications.htm

and Kentucky Lottery, "Lottery Board Thanks Staff for Record Year," Lottery News 8/01/02, online at

 www.kylottery.com

7 . American Economics Group, Inc., The U.S. Tobacco Industry in 1997: Its Economic Impact in the States.

CIGARETTES DON’T PAY TAXES – SMOKERS DO!!

Tobacco Taxes & Revenues

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