Replies

You seem to be under the false impression that smokers are a financial drain to Medicaid (it's not Medicare). As one example of how false this assumption is, I took time to do the math on a proposed tobacco tax increase in Wisconsin (to supposedly dig Medicaid out of bankruptcy) and composed this letter for the Wisconsin newspapers and government representatives.

If you dare to take the time to read it, you will see the real economic purposes for tobacco tax dollars. This is only one example of many states' proposed new extortion taxes, now being called "user taxes".

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Sent January 28, 2005:

"Thank you for your informative story on the proposed dollar per cigarette pack tax increase in Wisconsin. I have read two other news stories on this subject and would like to know how anyone with a conscience can possibly attempt to justify this new attempt at taxation without representation.

It has already been printed that State Rep. A.J. "Doc" Hines, Republican-Oxford, who heads the Assembly Health Committee, is planning to introduce the proposal next month. Also, Governor Jim Doyle has indicated in the past that he opposes a cigarette tax increase, and Assembly Speaker John Gard opposes this plan.

Quoting your story, "The statewide group (Smoke Free Wisconsin) says increasing the tax to $1.77 a pack from 77 cents a pack will keep 72,000 children from starting to smoke..."

If tax increases stopped "children" from smoking, there would be no smoking "children" left in the United States and Canada today. This exploitation of the word "children" is meant to draw a mental picture of curly headed tots smoking cigarettes and represents social engineering tactics in their most disgusting form. The "kids" being referenced are almost adults..and many are old enough to fight for their country. Also, legislation and tax increases have never helped anyone to stop smoking.

The Wisconsin state revenues from this proposed tax have already been estimated at $251 million annually, according to Smoke Free Wisconsin, with fifteen million dollars going towards tobacco use prevention efforts and the rest to offset a $121 million deficit in the state's Medicaid program. Using simple mathematics, that means that about 6 percent of the anticipated annual revenues would be "used to prevent the children from starting to smoke."

The remaining additional funds of $235 million would be applied to the Medicaid state deficit. State Rep. A.J. "Doc" Hines, R-Oxford, who heads the Assembly Health Committee was quoted as saying that the tax makes sense because 15 percent of Medicaid costs are caused by smoking. That means smoking has been "guestimated" as being responsible for $18,150,000 of the Medicaid deficit, leaving the other 85 percent of the $102,850,000 balance to also be paid out of smokers' pockets with the $1 dollar per pack additional tax.

The state would still have a projected $114,000,000 balance remaining for various "other" places. Not bad profit for a supposedly "for your own good" sin, er...excuse me, user tax. I wonder how much of that amount will be applied to additional funding for Smoke Free Wisconsin and the American Cancer Society?

Sincerely,
______________________________
Garnet Dawn - The Smoker's Club, Inc. - Midwest Regional Director
The United Pro Choice Smokers Rights Newsletter - http://www.smokersclubinc.com
Illinois Smokers Group - http://groups.yahoo.com/group/illinoissmokers/
mailto:garnetdawn@comcast.net - Respect Freedom of Choice!

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http://www.wausaudailyherald.com/wdhlocal/334268386035837.shtml

Groups support idea of cigarette tax raise
Many smokers see proposal as forcing a change in behavior

By Kyle Gearhart
Wausau Daily Herald

SmokeFree Wisconsin launched an effort Thursday to more than double the state's cigarette tax.

The statewide group says increasing the tax to $1.77 a pack from 77 cents a pack will keep 72,000 children from starting to smoke and offset smoking-related Medicaid health care costs by raising $251 million.

"Studies have shown that any price increase deters kids from smoking," said Judy Omernik, the group's president and organizer of the group's central Wisconsin anti-smoking efforts. "Kids are sensitive to price, so if the price increase is enough, it will keep kids from smoking." State Rep. J.A. Hines, R-Oxford, proposed the legislation, and Senate Majority Leader Dale Schultz, R-Richland Center, spoke in support of it Thursday at a Madison news conference. Gov. Jim Doyle has not said whether he would support such an effort.

Public reaction to the proposed $1 a pack tax increase is mixed. Nonsmokers generally support the proposal, but smokers are passionate in their opposition.

"I know people who smoke, who say they started when they were younger," said Manee Yang-Vongphakdy, 26, of Wausau, a nonsmoker. "So it could be helpful to stop more kids from smoking sooner."

Some of the money from the increased tax would go toward teen tobacco prevention programs, a purpose Yang-Vongphakdy said is a "good cause."

But not everyone agrees. Some see smoking as a personal choice and question using tax policy as a means to change people's behavior.

"I don't think that's right," said Yvonne Brandt, 70, of Wausau. "Why don't they do that to drinking? If they did, there would be an uproar. They are just taking our choices away."

Brandt said smoking already is "getting too expensive." As a smoker, she said, she can work eight hours without wanting to smoke but enjoys smoking outside of work. If prices go up, she is afraid, smoking will become a luxury she can't afford.

Wisconsin now has the 25th-highest cigarette tax in the country. In 2003, the average state cigarette tax was 84 cents. An increase to $1.77 a pack would move Wisconsin into the top five.

Advocates of the proposed tax increase, including the state's chapter of the American Cancer Society, say the benefits far outweigh any harm to individual pocketbooks.

"It's a statewide problem, and we have a statewide solution," Omernik said. "I'm hopeful that the proposal will start a discussion. If you look at the evidence, this is a good option and will benefit everyone."

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I really don't care if you smoke. I care if you subject me or my loved ones to your second-hand smoke. I care if you make me pay through my taxes that support medicare for indigent smokers who have spent all their money on thier habit and its results. I care if you are responsible for taking up medical research money that could be going to cure some disease that the sufferer can not prevent through a simple act of will. 50 posted on 03/06/2005 6:00:53 PM PST by Lucky Dog

Wisconsin Information

alt

Tobacco Taxes

Wisconsin's excise tax per pack of cigarettes: $0.770
Wisconsin's excise tax collection for the
fiscal year ending June 2002: $293,465,000

Sales tax on tobacco products: 5.00%

Federal excise tax per pack of cigarettes: $0.39
Total federal excise tax collections in fiscal year 2002: $7,512,700,000

Click here for the Cigarette Tax and Payment Table for all states.

Who Profits from
Cigarette Sales?

click for larger view

Comparing Excise Taxes on Cigarettes, Beer and Wine

click for larger view

Number of six-packs of beer that must be sold in Wisconsin to produce the same state excise tax revenue generated by one carton of cigarettes: 210.6

click for larger view

Number of bottles of wine that must be sold in Wisconsin to produce the same state excise tax revenue generated by one carton of cigarettes: 155.5

Wisconsin Smokers' Contributions
to the State Economy - 2002

Wisconsin smokers comprise only 23.6%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 Taxes²	$	293,464,555
Smokers Pay Sales Taxes²	$	77,578,077
Smokers Pay Tobacco Settlement Payments³	$	148,265,951
	$	519,308,583

Smokers' Economic/Tax Profile

Income

Wisconsin smokers' median income 2001¹

$

38,625

Wisconsin State Tax Liability for Median Income Smoker⁴

Annual state income tax liability for a couple	$	2,240
Annual state income tax liability for a couple with two children	$	2,195

Smoker Excise Tax/Sales Tax/Tobacco Settlement Payments Liability⁵

Total average paid per Wisconsin smoker in excise and sales taxes	$	391
Cost per Wisconsin smoker for settlement payments to Wisconsin	$	156
Total annual payment to Wisconsin per smoker	$	547

Wisconsin Smoker Facts⁶

Wisconsin FY2002 smoker payments of $519.3 million were nearly 12 times larger than state excise taxes on alcoholic beverages in 2001 ($44.9 million).
Smokers' payments in FY2002 were larger than state corporate net income tax collections ($495.4 million).
The total amount paid by smokers in Wisconsin could fund projected FY2001 spending on:
- Children and Family Services ($238.6 million) OR
- The entire Natural Resources Department budget ($462.5 million) OR
- Economic and Community Development ($71.2 million) AND
  
  Juvenile Correctional Services ($195.7 million) AND
  
  The Wisconsin Technical College System ($181.1 million) AND
  
  Intercollegiate athletics at the University of Wisconsin-Madison ($44.9 million).
In 1997, smokers provided 11,052 jobs that paid an additional $16 million to the state in personal and corporate income taxes.⁷

TOTAL SMOKER CIGARETTE PAYMENTS TO WISCONSIN

Per year:	$	519,308,583
Per day:	$	1,421,789
Per hour:	$	59,241
Per minute:	$	987
Per second:	$	16

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

Centers for Disease Control's Behavioral Risk Factor Surveillance System, 2001
Orzechowski & Walker, Arlington, Virginia; latest estimates from state revenue department
PriceWaterhouseCooper
State annual income tax liability from PayBreeze software of General Programming, Inc., San Jose, California, which utilizes the Exact Calculation Method.
U.S. Census Bureau 2001 state population estimate and Centers for Disease Control's Behavioral Risk Surveillance System, 2001
Tax and Budget Comparisons are from U.S. Census Bureau (online at www.census.gov.) and the State of Wisconsin Department of Administration State Budget Office, State of Wisconsin 2001-2003 Budget in Brief and State of Wisconsin 2001-2003 Executive Budget.
American Economics Group, Inc., The U.S. Tobacco Industry in 1997: Its Economic Impact in the States.

Master Settlement Agreement Payments To Date

$483,185,311 has been paid to Wisconsin since the Master Settlement Agreement was signed on November 23, 1998.

Do you have the same objections to taxes on beer, wine, liquor, perfume, etc.? If not, then it seems a bit hypocritical to merely object to those on tobacco products. If you object to those taxes on other nonessential products, then why are you only carping about those on tobacco?