Tobacco Tax Increase Hurts The Poor

A cigarette price increase to fund smoking prevention programs sounds like a good idea. . . . That is unless you're poor.

There currently is a call for a tobacco tax increase to be used to fund more smoking prevention initiatives. A proposed rise of 2.5¢ a cigarette would push a pack of 40s up another $1 and is hopefully going to reduce smoking by 2.6 per cent. This equates to about 50,000 less smokers and $400 million dollars in addition revenue. It sounds like a win-win situation by lowering the amount of smokers and providing more funds for anti-smoking campaigns. But there are some nasty holes in this strategy. Smoking costs the community $31 billion dollars every year which makes $400 million dollars seem a little insignificant . The real problem though is, who are the people who won't quit despite the price rise. For those who earn an average wage, it won’t matter too much but those who are less fortunate, it will hit hard ... very hard. Monetary penalties are biased and for people who have a good income, it offers little incentive to abide by whatever rules they are are penalised for. We see it intrenched in our society like parking fines, court fines, tax penalties etc. For example, if you are in court and can afford expensive legal representation, you have a greater chance of getting off. That leaves those who can’t afford to ‘buy’ off their conviction and are stuck with budget solicitors. What about speeding fines? If your in a hurry, why would a few hundred dollars worry you if you’re on your way to meeting where you could earn thousands of dollars? Being in a hurry to drop off the kids to your grandparents so you can make it in time to that part time cleaning job is not worth your week’s pay for a speeding fine. Monetary penalties are not relative to your wealth.

We all know smoking is wrong and those who smoke are evil, weak and decadent. Luckily we have someone to guides them away from their wicked ways. Addiction is just an excuse. -The ideology of government anti-smoking programs

Smokers are addicts. Very simple to understand but what’s harder to grasp are the levels of addiction and the addict's situation. A financially secure tobacco addict can simply keep smoking if their addiction is bad enough. But what if you can’t afford it? The calls for an increase in tobacco excise, like most policies regarding addiction, is based on wishful thinking. Addiction can cause those with less disposable income to act completely different to our expectations and when faced with price increases will often accommodate the increase by missing out on something else. Instead of fresh healthy food, they might buy cheaper alternatives. If they need new shoes for their kids, they might keep them wearing them for a few more months. The car needs new tires? That can wait until next year. Simply increasing the cost of something is a broad remedy to discourage use. We see it in the way a tighter monetary policy is used to control inflation. We see it with alcohol being priced out of the reach of heavy drinkers. It might achieve some of it’s intended outcomes but the cost to some is far greater. It is a lazy way to achieve results and requires some spin to get support.

"With rising costs in food, petrol and housing, tobacco is now relatively inexpensive'' -Quit executive director Fiona Sharkie

Relatively inexpensive! Smoking is about 10-20% of a household budget for low income earners, about the same as food. Increasing the price of tobacco will have a profound effect on these budgets and absurd comments from anti-smoking groups show they care very little for people but more for statistics and numbers. Like most drug related programs, financially challenged and the worst effected lose out by broad, disproportional strategies. Strategies that give great headlines and target the easily converted. Of course there is never an analyses of who doesn’t quit smoking and how it effects them but plenty of back slapping at the many who have been rescued from their evil ways. The call for proper analysis is raised every time a “price increase” strategy is put on the table but it gets approved very quickly to avoid full scrutiny.

"With tobacco costing the Australian community $31.5 billion every year, it is essential proven tobacco control strategies, including tax increase, are put into place as soon as possible ...'' -Quit executive director Fiona Sharkie

We have just seen “Alcopops” receive a huge tax increase in an effort to stem “binge drinking” of teenage girls. While it is generally taboo to criticise any effort to reduce smoking levels, alcohol strategies do face scrutiny. This latest “price increase” strategy for “Alcopops” has come under criticism for lack of research, not being effective and for disproportionately effecting the less fortunate compared to average wage earners. I wonder why those same people are basically ignored when it comes to tobacco.

[Article Bumped up from May]