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State of Tobacco Control 2019

State Tobacco Excise Tax Methodology

The U.S. Surgeon General, in The Health Consequences of Smoking – 50 Years of Progress, released in January 2014 to commemorate the 50th anniversary of the first Surgeon General's report on smoking in 1964, concluded that "increases in the prices of tobacco products, including those resulting from excise tax increases, prevent initiation of tobacco use, promote cessation and reduce the prevalence and intensity of tobacco use among youth and adults."1

Research has clearly demonstrated that as the price of cigarettes increases, consumption decreases. For each 10 percent price increase, it is estimated that consumption drops by about 7 percent for youth and 3 to 5 percent for adults.2 Increasing taxes on tobacco products other than cigarettes is also important as while rates of cigarette smoking are declining, rates of cigar smoking, and smokeless tobacco use are stagnant or increasing. In a number of states, rates of cigar smoking among youth exceed rates of cigarette smoking.

Prior to "State of Tobacco Control 2015" report, the American Lung Association assigned grades to states based on the level of a state's cigarette tax only. However, starting with "State of Tobacco Control 2015," taxes on tobacco products other than cigarettes were incorporated into the grading system. The grading system also was switched to a points-based system, with the level of state's cigarette tax worth up to 30 possible points and taxes on other tobacco products worth up to 10 possible points, for a total of 40 points available in the grading category.

The 30 points for the level of a state's cigarette tax will continue to be based on the average (mean) of all state taxes as the midpoint, or the lowest "C." The average cigarette tax was chosen because it is often seen as an indication of where states are in their cigarette taxing policies. The average state excise tax on January 1, 2019 was $1.78 per pack. The range of state excise taxes ($0.17 to $4.50 per pack) is divided into quintiles, and a state is assigned six points for attaining each quintile.

The score earned for the level of a state's cigarette tax is broken down as follows:

Score/Points

Tax

30

$3.56 and up

24

$2.67 to $3.559

18

$1.78 to $2.669

12

$0.89 to $1.77

6

Under $0.89

For taxes on tobacco products other than cigarettes, a state is evaluated on whether the tax on five specific types of tobacco products is a) equivalent to the state's tax on cigarettes and b) the tax on the specific type of tobacco product is not based on the weight of the product. Taxing tobacco products other than cigarettes by weight is inadequate because it means the tax level does not keep pace with inflation and tobacco industry or other price increases.

The five specific types of tobacco products other than cigarettes which states are evaluated on are:

  • Little cigars
  • Large cigars
  • Smokeless tobacco
  • Pipe/roll-your-own tobacco
  • Dissolvable tobacco products

States can earn up to 2 points total for each type of other tobacco product; 1 point if the tax is equivalent to the cigarette tax and 1 point if the tax is not weight-based. States will not be penalized for having a weight-based tax if they also have a minimum tax that is equal to the current cigarette tax or the weight-based tax is equivalent to the cigarette tax.

The overall grade breaks down as follows:

Grade

Points Earned

A

36 to 40 points

B

32 to 35 points

C

28 to 31 points

D

24 to 27 points

F

23 and below points

  • Sources
    1. U.S. Department of Health and Human Services. The Health Consequences of Smoking—50 Years of Progress: A Report of the Surgeon General. Atlanta, GA: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, 2014.
    2. There is general consensus among tobacco researchers that every 10 percent increase in the price of cigarettes decreases cigarette consumption by about 4 percent in adults and about 7 percent in children. Tauras J, et al. Effects of Price and Access Laws on Teenage Smoking Initiation: A National Longitudinal Analysis, Bridging the Gap Research, ImpacTeen. April 24, 2001.

    Did You Know?

    1. More than 27 percent of high school students in the U.S. use at least one tobacco product, including e-cigarettes, according to the 2018 National Youth Tobacco Survey.
    2. 7.2 percent of middle school students use at least one tobacco product, including e-cigarettes, according to the 2018 National Youth Tobacco Survey.
    3. From 2017 to 2018, high school e-cigarette use increased by 78 percent and middle school e-cigarette use increased by close to 50 percent in the 2018 National Youth Tobacco Survey.
    4. Smoking is the number one preventable cause of death in the U.S., killing over 480,000 people per year.
    5. Secondhand smoke kills more than 41,000 people in the U.S. each year.
    6. 28 states and Washington D.C. have passed laws making virtually all public places and workplaces, including restaurants and bars smokefree.
    7. The District of Columbia has the highest cigarette tax in the country at $4.50 per pack.
    8. Missouri has the lowest cigarette tax in the country at 17 cents per pack.
    9. The average of all states plus the District of Columbia's cigarette taxes are $1.78 per pack.
    10. Three states – Connecticut, Tennessee and West Virginia – spend no state dollars at all tobacco prevention programs.
    11. No state is funding its tobacco control programs at or above the CDC-recommended level (in Fiscal Year 2019).
    12. Kentucky, Oklahoma and the District of Columbia increased their cigarette taxes in 2018.
    13. No state approved a comprehensive smokefree workplace law in 2018.
    14. 12 states – California, Colorado, Connecticut, Indiana, Kansas, Kentucky, Maine, Massachusetts, Missouri, Ohio, Oregon and South Carolina– offer a comprehensive cessation benefit to tobacco users on Medicaid.
    15. Each of the 50 states and the District of Columbia provide tobacco quitlines, a phone number for quit smoking phone counseling. The median amount states invest in quitlines is $2.21 per smoker in the state.
    16. Massachusetts passed legislation increasing its minimum sales age for tobacco products to 21 in 2018.
    17. Six states, the District of Columbia and over 350 communities have passed Tobacco 21 laws.
    18. Nationwide, the Medicaid program spends more than $39.6 billion in healthcare costs for smoking-related diseases each year – more than 15.2 percent of total Medicaid spending.
    19. In 2009, the American Lung Association played a key role in the passage of the Family Smoking Prevention and Tobacco Control Act, which gives the U.S. Food and Drug Administration authority over tobacco products.
    20. The American Lung Association played a key role in airplanes becoming smokefree in the 1990s.
    21. 43 states and the District of Columbia spend less than half of what the CDC recommends on their state tobacco prevention programs.
    22. States spend less than three cents of every dollar of the $27.3 billion they get from tobacco settlement payments and tobacco taxes to fight tobacco use.
    23. Each day, more than 2,000 kids under 18 try their first cigarette and more than 300 kids become new, regular smokers.
    24. Each day, more than 1,900 kids try their first cigar. On average, more than 80 kids try their first cigar every hour in the United States – equaling about 712,000 every year.
    25. Smoking costs the U.S. economy over $332 billion in direct health care costs and lost productivity every year.
    26. The five largest cigarette companies spent over $23 million dollars per day marketing their products in 2016.
    27. Secondhand smoke causes $5.6 billion in lost productivity in the U.S. each year.
    28. Smoking rates are over twice as high for Medicaid recipients compared to those with private insurance.
    29. A 2013 study of California's tobacco prevention program shows that the state saved $55 in healthcare costs for every $1 invested from 1989 to 2008.
    30. A 2017 study found that states which expanded Medicaid had a 36 percent increase in the number of tobacco cessation medication prescriptions relative to the states that did not expand Medicaid. This means more quit attempts with proven cessation treatments are being made. 
    31. In 2018, three states, Idaho, Nebraska and Utah, voted to expand their Medicaid coverage, providing more smokers with access to tobacco cessation treatments.
    32. Uninsured Americans smoke at a rate more than two times higher than people with private insurance.
    33. An estimated one-third of Americans living in public housing smoke.
    34. Persons with mental illness consume close to 40 percent of all cigarettes in the U.S.
    35. Native Americans and Alaska Natives have the highest smoking rates among any racial/ethnic group.
    Get more facts »

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