Vote YES for $1/pack Cigarette Tax Increase to stop devastating Medicaid Cuts 

Current Illinois State Cigarette Tax: $0.98/pack

• Average state cigarette tax in U.S.: $1.46/pack
• Illinois ranks 32nd in the United States
• Last cigarette tax increase in Illinois was 10 years ago and was passed with bipartisan support

A $1 cigarette tax increase is a proven strategy to reduce youth smoking!

• Illinois kids who will not become smokers: 77,600
• Illinois Adults who will quit: 59,400

Medicaid is facing devastating cuts without additional funding!

• Medicaid current budget shortfall: $2.7 billion
• Smoking related costs to Medicaid: $1.8 billion/year
• Medicaid savings in the first year due to cigarette tax increase: $50 million
• Savings would continue to increase over time

$377 million* In additional cigarette tax revenue in the first year!

PLUS a federal match for an estimated total $700 million plus in additional funds in the first year!

• According to HR706, which passed the Illinois House, if the General Assembly cannot reach agreement on Medicaid savings, cuts will have to be made to other parts of the Illinois budget, totaling $2.7 billion
• By offsetting additional budget cuts, the cigarette tax can help keep Illinois’ economy moving forward

Vote YES for $1/pack Cigarette Tax Increase to stop devastating Medicaid Cuts Illinois residents support a $1/pack cigarette tax increase!

• 74% of Illinois residents support for $1/pack cigarette tax (2010 Statewide poll)
• 4 out of 10 smokers support a $1/pack cigarette tax increase

Significant cigarette tax increases are sustainable new revenues!

• Studies of cigarette tax increases across the U.S show sustainable revenue
• The increase in revenue generated is much greater than revenue without an increase, even when factoring in potential decline in smoking rates
• Any decrease will be gradual and predictable

*New revenues are based on application of “floor tax” or “inventory tax”.  New tax would apply to all cigarettes held in wholesaler or retailer inventories on effective date of the increase. 

Sources:

• Bridging the Gap Fact Sheet. (2010). Revenue and Public Health Impact of a $1.00. Cigarette Tax Increase in Illinois.
  
• Campaign for Tobacco Free Kids Fact Sheet. (2012). Key State-Specific Tobacco-Related Data & Rankings.
  
• Campaign for Tobacco Free Kids Fact Sheet. (2012). State Cigarette Excise Tax Rates & Rankings.
  
• Campaign for Tobacco Free Kids Fact Sheet. (2008). Tobacco Tax Increases are a Reliable Source of Substantial New State Revenue.
  
• Chaloupka, F. & Huang, J. (2011). A Significant Cigarette Tax Rate Increase in Illinois Would Produce a Large, Sustained Increase in State Tobacco Tax Revenues, UIC Institute for Health Research & Policy.

Download a copy of the Cigarette Tax Fact Sheet.