http://object.cato.org/sites/cato.org/files/serials/files/regulation/2014/12/regulation-v37n4-7.pdf
This article is about smoking and taxes. Basically, as many here think, smoking has gotten down to the hard core. All the smokers who wanted to quit and were able to do so in other ways, cold turkey, NRT's, etc. are gone from the ranks of smokers. And while gov't has put forth the idea that by taxing smoking, one can increase public health - that argument, because of the make up of 'who's left', is becoming a moot point, so that any increases in taxes lose the 'public health' argument and what is left is the 'revenue enhancement' argument but it's still promoted as public health, which basically no longer applies.
Table 1 presents the results from our analysis. The top panel
reports estimates of the effect of cigarette taxes on the probability
that a person smokes or not. The bottom panel presents
estimates of the effect of cigarette taxes on the daily number of
cigarettes smoked.
Column 1 in the top panel lists the estimate of the association
between cigarette taxes and smoking participation for adults ages
1874. The estimate is negative, close to 0 and not statistically
significant. The estimate from the Logistic regression is somewhat
difficult to interpret, so it is easier to focus on the elasticity,
which is listed in row 2. The elasticity measures the percentage
change in smoking in response to a 1 percent change in the tax.
The elasticity is 0.015, which is very small and not statistically
significant. It implies that a 100 percent increase in the cigarette
tax would decrease smoking among adults by 1.5 percent.
What this study has done is shown this to be the case where a percentage rise in taxes results in near negligible less smokers. And because of the income classes involved, that this regressive 'sin tax' hits the low income earners harder than anyone else - where they are spending some 14% of the income on cigarettes (in the less than $30,000 range) vs. 2% in the upper income ranges.
While not mentioning ecigs, this does show what most of us know and have seen happening - ecigs are the only thing that will now reduce the ranks of smokers - AND it will have a public health benefit - UNLESS ecigs are taxed as tobacco products.
This article is about smoking and taxes. Basically, as many here think, smoking has gotten down to the hard core. All the smokers who wanted to quit and were able to do so in other ways, cold turkey, NRT's, etc. are gone from the ranks of smokers. And while gov't has put forth the idea that by taxing smoking, one can increase public health - that argument, because of the make up of 'who's left', is becoming a moot point, so that any increases in taxes lose the 'public health' argument and what is left is the 'revenue enhancement' argument but it's still promoted as public health, which basically no longer applies.
Table 1 presents the results from our analysis. The top panel
reports estimates of the effect of cigarette taxes on the probability
that a person smokes or not. The bottom panel presents
estimates of the effect of cigarette taxes on the daily number of
cigarettes smoked.
Column 1 in the top panel lists the estimate of the association
between cigarette taxes and smoking participation for adults ages
1874. The estimate is negative, close to 0 and not statistically
significant. The estimate from the Logistic regression is somewhat
difficult to interpret, so it is easier to focus on the elasticity,
which is listed in row 2. The elasticity measures the percentage
change in smoking in response to a 1 percent change in the tax.
The elasticity is 0.015, which is very small and not statistically
significant. It implies that a 100 percent increase in the cigarette
tax would decrease smoking among adults by 1.5 percent.
What this study has done is shown this to be the case where a percentage rise in taxes results in near negligible less smokers. And because of the income classes involved, that this regressive 'sin tax' hits the low income earners harder than anyone else - where they are spending some 14% of the income on cigarettes (in the less than $30,000 range) vs. 2% in the upper income ranges.
While not mentioning ecigs, this does show what most of us know and have seen happening - ecigs are the only thing that will now reduce the ranks of smokers - AND it will have a public health benefit - UNLESS ecigs are taxed as tobacco products.