Obama proposes tobacco tax increase

Four years since President Barack Obama signed into law the largest federal cigarette excise tax in history, he is considering another proposal that would bring the federal tax on cigarettes up to almost $2.

Right now, the federal tobacco tax is $1.01. There is also a state cigarette excise tax which, in North Carolina, is $0.45 per pack. The proposal, which was released late last month as a part of the fiscal year 2014 budget, would increase the federal tobacco tax by $0.94 per cigarette pack.

The proposal would direct the funds from the federal tax to early education across the country — $75 billion would go to states to support high-quality preschool education for a 10-year period.

Another $15 billion from the federal tax would expand voluntary programs, which educate low-income parents about child development through home visits from professionals, to target children younger than the age of 3.

“Early education helps children get a strong start,” said Karen Schulman, a senior analyst of the National Women’s Law Center.

The proposal was drafted by nine different organizations, including the National Women’s Law Center, the American Academy for Pediatrics and the American Lung Association.

Studies by the High/Scope Educational Research Foundation show that children who participate in high-quality early education programs are more likely to be successful in further educational pursuits and less likely to be involved in crime.

“North Carolina has been a leader in early childhood up until recently,” Schulman said.

But now, N.C. early education programs need to improve, she said.

Schulman said the tobacco tax proposal would be especially beneficial to North Carolina to bring the state back to its former leading position in early education.

As a result of the long-term benefits from the program, 73,700 children would have little chance of becoming an addicted adult smoker, while $102.2 million would be provided to the state for preschool.

Aside from educational benefits, the tobacco tax increase could also improve citizens’ health. According to the proposal, about 42,000 smoking-caused deaths would be prevented in North Carolina alone.

“The tobacco tax itself is a public health intervention,” said Danny McGoldrick, vice president of research at Campaign for Tobacco-Free Kids.

Several organizations, including the U.S. Centers for Disease Control and Prevention and the U.S. Surgeon General, agree that raising tobacco prices reduces tobacco use.

McGoldrick also said that better education leads to better health, and vice versa. With higher quality education, people make more informed decisions that contribute to better health.

“It’s really a win-win,” McGoldrick said.

But Terry Stoops, the director for education studies at the John Locke Foundation, a right-leaning think tank, said he doubts that conservatives will support the proposal.

“While there’s a lot of support for pre-K education, especially for the most destitute children, expanding pre-K to a larger group, I think, is something that does not appeal to Republicans,” he said. “Honestly, it’s surprising that Democrats would support it as well.”

Stoops said Republicans worry that quality will be sacrificed as pre-K programs expand, wasting taxpayer dollars. The benefits of a pre-K education could also be diminished if the student’s primary school education is of poor quality, he said.

But according to studies compiled by the National Head Start Association, children who participated in high-quality early childhood programs are more likely to overcome poor quality elementary schools.

Stoops also said Republicans might disagree with the proposal because the tobacco industry could lose revenue.

“Increasing that tax would decrease the amount of revenue that we receive from it, and actually probably lead to a loss of revenue,” Stoops said.

But Kurt Ribisl, professor of health behavior at the UNC Gillings School of Global Public Health, said that is untrue.

“It’s neutral on the economy,” he said. “Even though there’s a drop in smoking rates, you see a net increase in revenue.”

Ribisl also said North Carolina already raised tobacco taxes, and revenue actually increased.

But a bipartisan agreement on this issue between Republicans and Democrats might not occur with the federal shutdown still dragging on. McGoldrick said it will be a while before the proposal is even discussed.

“You just never know whether it becomes part of the (budget compromise) or what will happen.”

state@dailytarheel.com