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FTC Report Shows Big Decline in Cigarette Sales after 2009 Federal Cigarette Tax Increase
Campaign for Tobacco-Free Kids ^ | Sep. 21, 2012 | Susan M. Liss

Posted on 09/21/2012 4:47:21 PM PDT by Drango

WASHINGTON, DC – A report issued today by the Federal Trade Commission shows that the number of cigarettes sold and given away in the United States fell by 10 percent in 2009, one of the biggest declines on record. This decline shows the impact of the 62-cent increase in the federal cigarette tax that took effect April 1, 2009, and is powerful confirmation that cigarette tax increases are one of the most effective ways to reduce smoking.

The 2009 decline in cigarette sales is the second largest on record since the FTC began reporting sales data in 1963. The only larger decline, 10.3 percent, was in 1999, when tobacco companies significantly increased cigarette prices to pay for the 1998 legal settlement with the states. The evidence couldn't be clearer: When cigarette prices go up, cigarette sales go down.

Other recent reports have also shown that the 2009 federal cigarette tax increase significantly reduced smoking. According to a University of Illinois at Chicago study published in April, youth smoking fell 10 to 13 percent immediately after the tax increase took effect. The researchers estimated that the tax reduced the number of youth smokers by at least 220,000 in the first two months alone. Even while reducing smoking, the tobacco tax increase raised more than $10 billion in just the first 12 months to help fund expansion of the State Children's Health Insurance Program. The federal tobacco tax increase has been the health win and the revenue win expected and should spur elected officials across the country to increase tobacco taxes.

The FTC today also reported the following data on tobacco marketing:

Cigarette marketing expenditures in the U.S. declined from $9.94 billion in 2008 to $8.53 billion in 2008 and $8.05 billion in 2010.

After increasing by 277 percent between 1998 and 2008, smokeless tobacco marketing decreased from $547.9 million in 2008 to $492.1 million in 2009 and $444.2 million in 2010.

While it is a positive step that tobacco marketing has declined, the tobacco companies continue to spend huge sums to market their deadly and addictive products. Counting both cigarette and smokeless tobacco marketing, the tobacco companies spent $8.5 billion on marketing in 2010 – more than $23 million each day and nearly $1 million every hour. Cigarette makers continue to spend the bulk of their marketing budgets – more than 80 percent – on price discounts that make cigarettes more affordable and appealing to price-sensitive kids

Tobacco companies spend far more to market tobacco products than states spend to prevent and reduce tobacco use. In fiscal year 2012, the states spent $456.7 million on programs to prevent kids from smoking and help smokers quit. That means tobacco companies spend more than $18 to market tobacco products for every $1 states spend to reduce tobacco use.

The continuing high level of tobacco marketing show why we need aggressive action by all levels of government to stop the tobacco epidemic. The states should increase tobacco taxes and restore funding for tobacco prevention programs that have been slashed by 36 percent in recent years. At the federal level, the Food and Drug Administration must effectively exercise its authority over tobacco products and marketing, the health care reform law's expansion of coverage for smoking cessation services must be implemented, and the Centers for Disease Control and Prevention should continue the highly successful anti-tobacco advertising campaign it launched this year.

Tobacco use is the nation's number one cause of preventable death, killing more than 400,000 people and costing $96 billion in health care bills each year. These deaths and costs are entirely preventable if elected officials at all levels fight tobacco use as aggressively as the tobacco companies market their deadly products.


TOPICS: News/Current Events
KEYWORDS: smoking
Econ 101.

An increase in price, reduces demand.

1 posted on 09/21/2012 4:47:26 PM PDT by Drango
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To: Drango

Total cigarette sales have increased when you include those sold on the black market.


2 posted on 09/21/2012 4:49:42 PM PDT by E. Pluribus Unum (Government is the religion of the sociopath.)
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To: Drango

The electronic cigarettes are going to effect the sales also. One gets the nicotine, but not the smoke. I use them now, and haven’t smoked in over a year. I am not sure how the tax’s will be counted on them.


3 posted on 09/21/2012 4:52:59 PM PDT by political1 (Love your neighbors)
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To: E. Pluribus Unum

Susie. If you believe that I have some nice SWAMP LAND in Florida you will be interested in.


4 posted on 09/21/2012 4:53:15 PM PDT by spawn44 (MOO)
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To: Drango

Two words. Black market.


5 posted on 09/21/2012 4:55:58 PM PDT by fhayek
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To: Drango

Next lesson: price elasticity of demand.

Third lesson: price elasticity of supply.

Someone learned those advanced lessons:

“Cigarette contraband has become so profitable that it is attracting organized crime and former drug contrabandists, ....”

http://www.tobaccoreviews.net/contraband-cigarettes-sales-increased-in-virginia/


6 posted on 09/21/2012 4:58:26 PM PDT by USFRIENDINVICTORIA
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To: Drango
Tobacco companies spend far more to market tobacco products than states spend to prevent and reduce tobacco use

Governments also clear more 'profit' from cigarettes than the tobacco companies do.

Some of us just went to less taxed forms of tobacco.

/johnny

7 posted on 09/21/2012 4:59:02 PM PDT by JRandomFreeper (Gone Galt)
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Comment #8 Removed by Moderator

To: Drango

The 2nd to last paragraph is pure liberalism, dripping with dictatorial demands.


9 posted on 09/21/2012 5:00:31 PM PDT by nhwingut (Sarah Palin 12... No One Else)
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To: fhayek

Or one acronym: RYO

I switched after hearing the super-tax on cigarettes was on the way. Then loaded way up after hearing the super-tax on RYO tobacco was on the way - and before my favorite supplier (D&R) got out of the business. Still rolling.


10 posted on 09/21/2012 5:03:57 PM PDT by LearsFool ("Thou shouldst not have been old, till thou hadst been wise.")
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To: Drango

How many murders are committed due to the War On Tobacco?


11 posted on 09/21/2012 5:05:13 PM PDT by Mark (Don't argue with my posts. I typed while under sniper fire.)
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To: Drango

I have to laugh that the same people who say increasing taxes on cigarettes reduces smoking but increasing taxes on income has no economic effect


12 posted on 09/21/2012 5:07:47 PM PDT by MNJohnnie (Giving more money to DC to fix the Debt is like giving free drugs to addicts think it will cure them)
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To: Drango
"Tobacco use is the nation's number one cause of preventable death, killing more than 400,000 people and costing $96 billion in health care bills each year"

That 4000,000 number hasn't changed in 20 years yet less number of people are smoking now than ever before.

So which is right ? ( p.s. 70,000 smokers a year 85 and over are included in that 4000,000 number that die prematurely)
13 posted on 09/21/2012 5:07:52 PM PDT by stylin19a (Obama -> Ransom "Rance" Stoddard)
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To: Drango
Your link leads to a nanny/lefty run site that partners with the World Health Organization. Why are you posting lefty drivel? Ahhhh! That's right! You're a nanny-stater when it's something that YOU disapprove of.

Kick the habit! Become a CONSERVATIVE.

14 posted on 09/21/2012 5:14:04 PM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: Drango

No, no, no, that never happened. For that to have happened would mean that Obama raised taxes on the poor.


15 posted on 09/21/2012 5:15:14 PM PDT by andyk (I have sworn...eternal hostility against every form of tyranny over the mind of man.)
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To: stylin19a
(p.s. 70,000 smokers a year 85 and over are included in that 400,000 number that die prematurely)

Hahaha! Sounds about right for today's "science". Here's another one, I'll bet:

Doctor: "Did your great-grandfather smoke?"

Grieving man: "I recall he said he tried it once when he was a boy."

Doctor: "Okay, we'll put it down as another smoking-related death."
16 posted on 09/21/2012 5:20:13 PM PDT by LearsFool ("Thou shouldst not have been old, till thou hadst been wise.")
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To: DJ MacWoW; Drango
Yep. The OP has a history of fairly frothing about cigarettes.

Must hate free men that chose for themselves.

Smoke 'em if ya got 'em.

/johnny

17 posted on 09/21/2012 5:27:44 PM PDT by JRandomFreeper (Gone Galt)
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To: JRandomFreeper; Drango

Yep!


18 posted on 09/21/2012 5:31:02 PM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: MNJohnnie

In this case, the taxes just drove people to other methods and government won’t accept the revenue loss laying down. They’ll just hike the taxes somewhere else.


19 posted on 09/21/2012 5:34:00 PM PDT by cripplecreek (What does it profit a man if he gains the whole world but loses his soul?)
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To: LearsFool
Or one acronym: RYO

When they jacked up the tax on loose cigarette tobacco by 2300%, a lot of people simply switched to the coarser cut pipe tobacco which they say is effectively the same as the cigarette tobacco at half the price.
20 posted on 09/21/2012 5:39:08 PM PDT by cripplecreek (What does it profit a man if he gains the whole world but loses his soul?)
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To: LearsFool

There’s a RYO place across the road from me. They have a sign out about $20 cartons, I though dang that’s a lot of money (we quit when it got to about $12 carton) then I noticed today in walgreen’s that cigarettes were about $5 a pack. unreal.


21 posted on 09/21/2012 5:39:35 PM PDT by visualops (artlife.us)
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To: cripplecreek
Some of us got serious about growing and curing our own.

/johnny

22 posted on 09/21/2012 5:42:10 PM PDT by JRandomFreeper (Gone Galt)
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To: JRandomFreeper

You can buy the 5 lb bag of loose pipe tobacco for the same price as a 1 lb bag or regular cigarette tobacco. It rolls and smokes the same.


23 posted on 09/21/2012 5:44:34 PM PDT by cripplecreek (What does it profit a man if he gains the whole world but loses his soul?)
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To: visualops

My RYOs are about $10 a carton. (A sight better than $40-50 Marlboros.)

Not long ago I could stop at the local convenience store and fill up the car with gas and grab a carton of smokes for $40.

Now I can do one or the other.


24 posted on 09/21/2012 5:49:21 PM PDT by LearsFool ("Thou shouldst not have been old, till thou hadst been wise.")
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To: Drango

The again, this is the Obama administration reporting on how successful it has been.


25 posted on 09/21/2012 5:52:44 PM PDT by yefragetuwrabrumuy (DIY Bumper Sticker: "THREE TIMES,/ DEMOCRATS/ REJECTED GOD")
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To: cripplecreek
Yep... I am familiar. ;)

My tagline isn't just for decoration. I'm doing everything I can to starve the beast, and lower my costs.

/johnny

26 posted on 09/21/2012 5:53:39 PM PDT by JRandomFreeper (Gone Galt)
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To: cripplecreek

Was just discussing the pipe tobacco with JRandom. I have a bit of trouble with it not burning quite as well. (Some have suggest a quick burst in the coffee grinder to shred it a bit.)

At least it’s escaped the tax-monster for the time being.


27 posted on 09/21/2012 5:53:55 PM PDT by LearsFool ("Thou shouldst not have been old, till thou hadst been wise.")
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To: fhayek

Yup, the black market has taken over here. People selling them by the carton cheaper than what you can buy in the store.


28 posted on 09/21/2012 5:55:09 PM PDT by eXe (Si vis pacem, para bellum)
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To: LearsFool

If the anti smoking nazis get their way, you won’t be able to do either. Big brother already thinks we drive too much and if they can tax smoking out of existence there’s no reason they can’t do the same with gas.


29 posted on 09/21/2012 5:56:05 PM PDT by cripplecreek (What does it profit a man if he gains the whole world but loses his soul?)
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To: Drango

I have never smoked and frankly I pay about as much attention to cigarettes as I do earth worms. But, I noticed this week that a pack of smokes is about $6.00. That is just insane. It could not take more than $.75 to produce them.


30 posted on 09/21/2012 5:56:05 PM PDT by isthisnickcool (Sharia? No thanks!)
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To: isthisnickcool

Pack a day math
$6.00 x 365 days = $2,190 a year. (YIKES)


31 posted on 09/21/2012 6:02:01 PM PDT by Drango (A liberal's compassion is limited only by the size of someone else's wallet.)
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To: isthisnickcool
Federal taxes are over a dollar a pack, state taxes can range as high as $4/pack (NY).

Government makes much more money off of cigarettes than manufacturers do.

Actual cost is about $1/pack counting tobacco company profit.

/johnny

32 posted on 09/21/2012 6:04:27 PM PDT by JRandomFreeper (Gone Galt)
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To: JRandomFreeper
My tagline isn't just for decoration. I'm doing everything I can to starve the beast, and lower my costs.

Same here. I spent my day canning tomatoes and should finish them up by about monday. I got the tomatoes by trading 200 lbs of dry beans to the farmer because he doesn't grow them.
33 posted on 09/21/2012 6:05:11 PM PDT by cripplecreek (What does it profit a man if he gains the whole world but loses his soul?)
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To: Drango
Since well over half the price is taxes... yep, yikes. Government is out of control.

/johnny

34 posted on 09/21/2012 6:05:54 PM PDT by JRandomFreeper (Gone Galt)
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To: Drango

The continuing high level of tobacco marketing show why we need aggressive action by all levels of government to stop the tobacco epidemic. The states should increase tobacco taxes and restore funding for tobacco prevention programs that have been slashed by 36 percent in recent years. At the federal level, the Food and Drug Administration must effectively exercise its authority over tobacco products and marketing, the health care reform law’s expansion of coverage for smoking cessation services must be implemented, and the Centers for Disease Control and Prevention should continue the highly successful anti-tobacco advertising campaign it launched this year.


Have fun while you can, Hitler and his thugs finally got what they had coming and you will also have to pay, and i think Hitler will come out looking pretty good compared to you people.


35 posted on 09/21/2012 6:08:39 PM PDT by ravenwolf
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To: ravenwolf
Hitler was VERY anti-tobacco.

/johnny

36 posted on 09/21/2012 6:13:08 PM PDT by JRandomFreeper (Gone Galt)
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To: JRandomFreeper

Hitler was VERY anti-tobacco.


Well i wish you had not have said that, i have suspected for years that the most evil people in the world are anti smokers ( and i do know the big difference between people who don,t smoke and anti smokers )

Now i am convinced.


37 posted on 09/21/2012 6:26:45 PM PDT by ravenwolf
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To: ravenwolf

I’ve heard that he was also anti-religion. Really.


38 posted on 09/21/2012 6:40:39 PM PDT by vox_freedom (America is being tested as never before in its history. May God help us.)
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To: LearsFool

You are correct.


39 posted on 09/21/2012 6:49:39 PM PDT by mojo114 (Pray for our military)
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To: DJ MacWoW

Now DJMacWoW I have something to confess I’ve sinned for I’m a smoker please forgive me. sarc/w a touch truth. :)


40 posted on 09/21/2012 7:19:51 PM PDT by Clyde5445
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To: vox_freedom

I’ve heard that he was also anti-religion. Really.


I don,t know what he was as far as religion is concerned, the anti Christians would most likely call him religious, equating religion with Christianity.

But if he had a religion or not i don,t know.


41 posted on 09/21/2012 7:45:55 PM PDT by ravenwolf
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To: Clyde5445
Now now dear man. When I said Kick the habit! I meant the habit of being a nanny-stater. :-D
42 posted on 09/21/2012 7:51:52 PM PDT by DJ MacWoW (My faith and politics cannot be separated)
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To: DJ MacWoW

Well that’s good to hear. I thought for momment you may hold my dirty little secret against me. :)


43 posted on 09/21/2012 8:08:31 PM PDT by Clyde5445
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To: Drango
FTC Report Shows Big Decline in Cigarette Sales after 2009 Federal Cigarette Tax Increase...would that be the 2009 increase that raised taxes - disproportionately - on the poor and middle class after Obama claimed he never would, and still claims he never did?.......
44 posted on 09/21/2012 9:46:53 PM PDT by Intolerant in NJ
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To: Drango

I’m long overdue for a Monte #2.


45 posted on 09/21/2012 9:55:01 PM PDT by Gene Eric (Demoralization is a weapon of the enemy. Don't get it, don't spread it!)
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To: Drango

So where’s the logic here? Tax the cigarettes and get rid of them. Tax the rich and we’ll be rid of them too?

I have to admit as a former smoker (5 years and Chantix worked for me) that the taxes had a lot to do with my quitting. I never wanted to before the taxes raised the price of a carton to $70.


46 posted on 09/21/2012 11:10:36 PM PDT by tinamina
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To: Drango

Oh yes, I forgot that the tax increase to $70 a carton in Montana was “for the children” so it got voted in by the populace.


47 posted on 09/21/2012 11:19:59 PM PDT by tinamina
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To: tinamina
...it got voted in by the populace.

WHAT? How dare the people vote! Those fools.

48 posted on 09/22/2012 10:38:52 AM PDT by Drango (A liberal's compassion is limited only by the size of someone else's wallet.)
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