Tobacco product prices increasing

The Associated Press
3/23/09

TULSA, Okla. (AP) – It’s going to be more expensive for Oklahoma residents who use tobacco products.

Federal taxes on cigarettes and chewing tobacco will increase April 1, and the estimated annual revenue of $32.8 billion will pay for an expansion of children’s health care coverage.

Smokers who roll their own cigarettes will see the biggest increase, with that type of tobacco going up from $1.10 per pound to $24.78 per pound. Taxes on cigarette papers and tubes are also going up from 1 cent per 50 for papers to 3 cents, and from 2 cents per 50 for tubes to 6 cents.

“It’s been the least expensive way of smoking, but it won’t be any more,” Mark Clymer of Ted’s Pipe Shop in Tulsa said.

Cherokee Nation spokesman Mike Miller said the tribe was unsure what type of effect the increase in tobacco prices would have on licensed smoke shop owners, but that it would not affect tribal government revenue.

“From the Cherokee Nation’s perspective, we don’t know for certain what impact it might have on tobacco sales, but any decrease in tax revenue generated by tobacco tax will be more than offset in savings on our health care costs,’’ Miller said.

Name-brand cigarette smokers are already effectively paying the 62 cent-per-pack hike on a pack of cigarettes from the nation’s largest manufacturers, RJ Reynolds and Phillip Morris. Prices increased as much as 75 cents per pack earlier this month.

Greg Mathe, a spokesman for Phillip Morris parent Altria, said the increases are a “direct response to the federal tax.”

QuikTrip’s Mike Thornbrugh said by jumping the tax increase, the manufacturers prevented customers from stockpiling cheaper cigarettes.

“They’ve been caught by surprise,” Thornbrugh said.

Tulsan Kyle Lessing said he will probably find a way to keep up his carton-a-week smoking habit.

“Nobody who smokes wants to smoke,” he said.

Research has suggested that three-fourths of smokers would like to quit.

Calls to Oklahoma’s cessation hot line funded by the state’s Tobacco Settlement Trust Fund increased from an average of 300 to 500 a week to 1,100 in the second week of March, according to Executive Director Tracy Strater.

“For every 10 percent increase in price, we see a 4 percent decrease in use,” Strater said. “For youth smoking, it’s a 7 percent decrease.”

Elizabeth Butler, a Tulsa psychologist whose practice includes cessation treatments, says that while financial consideration can be a reason, it usually isn’t enough to get someone to give up tobacco.

“It’s a strong motivator, but it’s not the primary motivator,” Butler said. “For most people, quality of life and health are the deciding factors.”

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