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Tabocco Tax

In: Social Issues

Submitted By senoff
Words 3579
Pages 15
Abstract

This paper is a cumulation of a three part portfolio assignment describing the tobacco tax issue in the United States. The first part of the paper defines the tax issue and gives a brief history of the tobacco excise tax. The second section discusses the stakeholders and an analysis of the issue. And lastly, I describe my policy perspective.

The Tobacco Tax Issue

Is taxation on tobacco an effective means of decreasing the smoking rate or is it just an elaborate ploy to increase taxes by playing on voter emotions? The message is clear and has been etched in our minds over the years; tobacco kills. Tobacco and secondary tobacco products kill an estimated 440,000 Americans per year. Over the past several decades, state and local governments have passed tobacco excise taxes and other laws regulating the use of tobacco. But who is actually behind the legislature?

First Tobacco Tax

Tax on tobacco was first implemented by Alexander Hamilton, secretary of the treasury, in 1794 (Altman, 2009). The tax was soon repealed, but excise taxes have been a staple in federal revenues since the American Civil War.

In 1921, Iowa successfully passed the first state tax on tobacco, with many states to follow. Not only does the federal government and state governments tax tobacco, but now city municipalities are also imposing a local tax on tobacco (Altman, 2009).

But what is the current tobacco tax about? There are several sides to the argument, as is the case in most taxes. Advocates of the tobacco tax argue that the tax is not only an increase to federal, state and local government revenues, but also the tax saves lives. 900,000 lives were estimated to be saved with the 2009 tobacco tax increase and it stopped 2 million children, under the age of 18, from starting to smoke (Altman 2009).

According to the Centers...

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