Vice Taxing

Utah’s legislators are about to set the stage for placing a tax on tobacco products.  But what about considering increasing taxes on all “vices”?

HB196 Tobacco Tax Revisions aims to increase the tax rates “on the
sale, use, storage, or distribution of tobacco products in the state for the 2010-11 fiscal year and allowing the rates to fluctuate in subsequent fiscal years”.

SB40 Cigarette and Tobacco Tax Amendments aims to
“increase the tax on cigarettes, moist snuff, and other tobacco products; deposit income from the permanent state trust fund into the General Fund; and
address the deposit of revenues collected from the taxes; make technical and conforming changes”.

HB71 Nicotine Product Restrictions “amends provisions of the Uniform Driver License Act, provisions relating to the state system of public education, the Utah Criminal Code, and the Utah Code of Criminal Procedure to place restrictions on the provision, obtaining, and possession of a nicotine product and to enforce these restrictions”.  Specifically, the bill is aimed to prevent the sale of nicotine laced candy and gum (not including smoking cessation products) in Utah, the products of which are currently not available in the state.

The sponsor of HB71, Rep. Paul Ray, R-Clearfield, has been the target by tobacco companies for possible court action should the bill pass, according to a Deseret News Article.

“Now they need to try to keep going by doping candy with the most addictive and deadly substance in tobacco,” he said. “Utah has made a point of protecting our youth from the hazards of tobacco use, and now that they are targeting a new market with lozenges and mints, we think that’s going to far.”

Read the rest of the article here.

In his piece in the Deseret News, Tobacco tax to hit those who can least afford it Lee Benson shares his encounter with folks addicted to tobacco who, despite raising taxes on the products and thus the consideration to stop the addiction, still are not able to stop.

“I know smoking’s not healthy,” he[patron at tobacco shop] says. “But every time I stop smoking, I gain weight — so I have to decide, am I going to die from obesity or from smoking?”

Smokers, he says, are a “scapegoat” for taxation.

“Nine percent of taxpayers smoke. Out of that 9 percent, they’re trying to take care of the majority. It isn’t fair. But what can you do?”

Benson interviews Sy Pham,  a tobacco wholesaler, who complains of the disparity between citizens actually paying for the tax increase:


Sy says he is still reeling from the 62-cents-per-pack federal tobacco tax increase that was implemented a year ago — an increase, he claims, that cut his profits by 20 percent.

Tobacco taxes not only target a minority of the public, he says, but they target the poor over the rich.

For evidence, he explains that he consistently delivers 65 percent of his tobacco to the west side of the freeway that dissects the valley, with just 35 percent going to the more affluent east side.

Read the rest of the post here.

Joseph Cramer, M.D., posts a piece in the Deseret News supporting tobacco tax increases and in which he generates a list of many reasons to do so while posing questions about the issue of raising the tax.

….when it is reported that individuals say the proposed increase is too high, I have to wonder, too high compared to what? Too high it will embarrass us as a people? Too high the state revenue computers wouldn’t be able to calculate the savings? Too high that young people thinking about starting can’t count that far? Too high thereby producing too many digits to put on the price tag? Too high to prevent us from being in the executive club of states with the lowest taxes of all states that do not produce tobacco? Too high because the tobacco lobby says it is too high?

Read the rest of the article here.

Looking at  contributors to health problems in the U.S., health statistics from 2002 found at demonstrate the following on smoking and obesity:

Daily Smokers:  17.5% which is lower than 29 other nations (Source: World Health Organization)

Obesity:  30.6% which is #1 on the list above the other 28 nations. (Source: UNICEF (United Nations Children?s Fund). 2002. Official Summary: The State of the World’s Children 2002. New York: Oxford University Press)

Official Studies on obesity in the U.S. are cited at Calorie Lab (January 2010)

According to the figures, nearly 34 percent of American adults are obese. That’s double the percentage who were obese 30 years ago, but it’s a number that’s held pretty steady for the last 10 years.

Among children, the rate has tripled, to 17 percent, but that figure also seems to be holding. In fact, the obesity rates among women and children have been on a plateau for nearly a decade, the figures say.

The numbers, reported in the Journal of the American Medical Association, came from two different studies among adults and kids. The adult study looked at a sample of 5,555 people and compared the obesity rate — which was 33.8 percent — to similar studies done from 1999 to 2006.

It stands to reason, then,  that increased taxes should be imposed on all products that contribute to health problems – a “vice” tax, if you will.  Junk food and fast food should top the list since it is a known fact that overuse of junk food products lead to health problems.   Utah legislators should be examining the potential implementation of a vice tax on all these products, not just the one vice that affects one population of users – and the one that comprises the least amount of consumers of  a particular vice.


(cross-posted at Utah Legislature Watch)


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