New York Increases Cigarette Tax, Sparking Diverse Responses

Starting Friday, New York has introduced an additional $1 tax on cigarettes, taking the state tax to an unprecedented $5.35 per pack. This makes it the highest state tax in the country, with the price for a pack reaching approximately $12 in various outlets. Additionally, New York City will impose an extra tax of $1.50 per pack, raising the cost even further. This marks the first such hike in the state since 2010.

Health professionals and activists have celebrated this move, citing its potential to reduce the number of smokers and consequent cancer-related fatalities. However, critics, particularly anti-tax factions, warn that this might lead to a spike in the trade of untaxed, illegal cigarettes within the state.

Data from the American Lung Association suggests that a 10% surge in tobacco prices could result in a 4% decline in its consumption. Furthermore, projections by the American Cancer Society’s Cancer Action Network anticipate that this tax augmentation might inspire 44,000 New Yorkers to give up smoking. It’s also believed that roughly 14,400 adolescents under 18 might refrain from picking up the habit.

The Cancer Society also speculates that this decision could prevent 15,300 premature deaths caused by smoking-related diseases. In terms of financial benefits, the savings in health care costs, specifically an estimated $35.37 million in Medicaid expenses, are expected over the upcoming five years.

On the contrary, the Mackinac Center for Public Policy, known for its fiscal conservatism, predicts the tax increase will trigger an 11% rise in the illicit smuggling of untaxed cigarettes. They highlight that currently, about 55% of cigarettes used in New York are sourced from the black market, a number they foresee climbing to 66% due to the tax increase.

Entities like the New York State Association of Convenience Stores have also weighed in, projecting that this tax enhancement might reduce cigarette tax revenue by 7.8%, equivalent to a loss of $72.3 million.

While the tax increase is a commendable step, anti-tobacco advocates emphasize the need for further action, particularly in regulating and taxing vaping products, which are becoming increasingly popular among the youth.

The American Lung Association expresses its hope to see higher taxation on vaping products in the future. Casey O’Neill, a senior media advocacy manager for the Cancer Action Network, stated, “We are committed to achieving tax equality across all tobacco products.”

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