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West Virginia Eying Cigarette Tax Increase

2 min readBy: Brian Phillips

As the saying goes, no victory is ever final.

This fall, the good people of California defeated Proposition 86, which would have increased cigarette taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. es by an additional $2.50 per pack. Proponents of the tax hike said it would raise necessary funds for health care, as well as provide an incentive to stop smoking. Fifty-two percent of voters thought the citizens united against Joe Camel were the ones blowing smoke and rejected increased taxes.

Exactly one month to the day after Proposition 86 was extinguished, a new report released by a coalition of anti-smoking organizations ranked West Virginia 21st in the country in total spending on tobacco prevention programs. The report says the state’s $5.4 million in spending is woefully below the Center for Disease Control’s recommendation of $14.1 million.

Guess where West Virginia lawmakers are looking to get the extra money? Save the drum roll:

In August, outgoing Senate Minority Leader Vic Sprouse, R-Kanawha, said the state could save money on health care costs by raising the cigarette tax, which could induce some smokers to quit.

Supporters usually attempt to frame cigarette taxes as a public health issue. But numerous studies show no connection between increased taxes and a decline in smoking. The behavior it does promote is getting smokers to turn to low-tax states or the black market to make their purchases.

In a debate with Tax Foundation Chief Economist Patrick Fleenor, a representative from the American Cancer Society (one of the groups releasing the study) all but denied the existence of a black market despite a mountain of evidence to the contrary. If it were truly a public health issue, then the growth of the black market – where minors can purchase cigarettes with ease — should be a serious concern.

Cigarette taxes are, however, a cash cow. In West Virginia:

The cigarette tax has generated $46.4 million so far this year — $1.6 million more than projected. The smokeless tobacco tax has brought in $2.08 million, beating estimates by $83,000.

The anti-smoking lobby says it’s all about the Benjamins, too:

“We haven’t come close to spending what needs to be spent,” said Chuck Hampshire of the American Heart Association in West Virginia. Hampshire said raising the cigarette tax from 55 cents to one dollar, as had been discussed in the West Virginia Tax Modernization Project report released in October, could bring in $60 million extra per year.

“It’s a targeted tax hike against people they don’t like,” says the Tax Foundation’s Curtis Dubay. That might be true, but West Virginia lawmakers certainly enjoy spending the $50 million that cigarette purchases raise each year.

In a telling moment during the debate with Fleenor, the ACS spokesman chided that cigarettes were as addictive as heroin. Does anyone think a heroin addict would stop shooting up if he had to pay an extra fifty cents for each hit?

No one should expect smokers to stop either. But with all that extra revenue at stake, well, that’s kind of the point.