NY's New Tax Latest to "Punish" Smokers -- It's What the Public Wants

New York's proposed new additional tobacco tax of $1.60/pack, pushing the total price of a pack of cigarettes to over $10, is designed both to raise an additional $440 million in revenue and, according to some, to "punish" smokers, but it's simply the latest is a growing number of measures aimed at smokers many regard as punitive, and is in line with growing public sentiment to force smokers to pay a higher share of the costs of smoking, says Action on Smoking and Health (ASH).

New York's new total tax of $4.35 per pack would be in line with other states which also have high taxes, including Rhode Island ($3.46), Connecticut ($3.00), New York state ($2.75), New Jersey ($2.70), Hawaii ($2.60), Wisconsin ($2.52), Massachusetts ($2.51), Vermont ($2.24), Washington ($2.025), Alaska ($2.00), Arizona ($2.00), Connecticut ($2.00), District of Columbia ($2.00) Maine ($2.00), Maryland ($2.00), Michigan ($2.00), Alaska ($2.00), Arizona ($2.00), District of Columbia ($2.00), Maine ($2.00), Maryland ($2.00), and Michigan ($2.00). [as of January 2010]

This growing trend to require smokers to pay in taxes at least a portion of the huge costs they impose on the economy -- almost $200 billion a year -- is also reflected in a recent national poll which finds that voters favor a $1/pack increase in state cigarette taxes by an overwhelming 67%-31% margin -- more than 2 to 1 -- with 53% saying they "strongly" support such a tax increase. The increase is favored by Democrats (70%), Republicans (58% percent), and Independents (64%).

It's also consistent with a recent study showing that almost half of all large U.S. companies penalize employees' unhealthy behavior (especially smoking at 64%) or plan to do so shortly. More than a dozen states already require their employees who smoke to pay more for health insurance, and one state charges smokers more under Medicaid.  A growing number of companies are following the lead of the W.H.O. and refusing to hire smokers; judges have issued orders in the large majority of states banning smoking in homes to protect children, and more and more states are prohibiting smoking in foster homes and in cars when kids are present.

Charging smokers more is also what the public wants, says public interest law professor John Banzhaf of ASH.

When MSNBC reported in August, 2009, on a plan by ASH to incorporate personal responsibility into the new health reform law by charging smokers more for health insurance, it noted that 57% of Americans favor higher health insurance premiums for smokers, as contrasted with only 36% favoring a similar surcharge on the obese. www.pr-inside.com/most-want-health-insurance-smoker-surcharge-r1 ..

Interestingly, the new health reform law does in fact permit charging smokers up to 50% more for their health insurance, but similar surcharges for other health factors such as obesity can be instituted only if they are part of a federally qualified "wellness" program, and then only up to a lower percentage.

At about the same time, the WorkTrends report noted that a majority of workers supported charging employees who smoke more for their health insurance (50% vs 47%), whereas they opposed similar charges for those who drink too much alcohol (43% vs. 54%), and strongly oppose such charges for workers who are very overweight (26% vs. 69%). www.heldrich.rutgers.edu/uploadedFiles/Publications/Heldrich_Cen ..

Interestingly, the same report said that workers also strongly oppose the use of financial incentives to promote healthier behaviors. "The notion that participation in a wellness program should be rewarded with extra pay or extra time off, however, is troubling to workers. . . . Two thirds of workers (66%) feel that employers should not provide extra pay to participants, and 6 in 10 (59%) say the same about extra time off."

A more recent survey by CNNMoney.com showed even more support for charging smokers higher rates for health insurance. Asked "should insurers penalize people for unhealthy behavior?," 31% said "yes, it promotes good health," and an additional 22% responded "only for very unhealthy things like smoking." In short, 53% would support such a surcharge, whereas only 31% favor using incentives instead. money.cnn.com/POLLSERVER/results/51174.html

A much higher percentage of employees would probably support charging smokers more for health insurance if they realized that each smoking employee can cost a company more than $10,000 a year in higher health care costs, disability payments, time lost from work, etc. -- money which otherwise could be used to provide better health insurance coverage for all employees, higher salaries, or for other purposes. ash.org/$12000.

PROFESSOR JOHN F. BANZHAF III
Professor of Public Interest Law at GWU,
FAMRI Dr. William Cahan Distinguished Professor,
FELLOW, World Technology Network, and
Executive Director and Chief Counsel
Action on Smoking and Health (ASH)
America’s First Antismoking Organization
2013 H Street, NW
Washington, DC 20006, USA
(202) 659-4310 // (703) 527-8418
http://ash.org/