Rocky Mountain Higher
Colorado bringing in additional revenue by hiking tobacco tax
Published in CSP Daily News
DENVER -- Cigarette sales in Colorado fell 22% this year after the state increased the tobacco tax by 64 cents a pack, reported the Rocky Mountain News. From January through November 2005, nearly 4.2 billion cigarettes were sold in Colorado, down from more than 5.3 billion during the same period in 2004.
But even with the drop in sales, the new tax is bringing in nearly $133 million in additional revenue this year, according to the report, citing the state Department of Revenue.
The state cigarette tax, which now totals 84 cents [image-nocss] a pack, helps fund Medicaid for disabled children, along with other health programs, including clinics serving uninsured patients, tobacco education and research grants for treating breast and cervical cancer, said the report.
Anti-tobacco advocates say the increased tax can motivate smokers to quit. The number of cigarette smokers has been decreasing nationally in the past couple of years. About 21% of Americans smoked in 2004, compared with 23% in 2002, according to the report, citing the Centers for Disease Control & Prevention. Colorado, however, appears to be bucking that trend; 20% of the population smoked in 2004, a 1.4% increase from the previous year, said the report, citing the Colorado Department of Public Health & Environment.
Despite declining over-the-counter salesdue mainly to Internet salesColorado still expects to bring in more than $160 million per year from the cigarette tax in the next five years. Despite Internet sales, every single state that has increased cigarette taxes has brought in more income, Eric Lindblom, director for policy research for the Campaign for Tobacco-Free Kids, told the newspaper. The taxes always bring in big chunks of money.