There are around 50 million smokers in the United States today, and the taxes collected from the cigarettes purchased by this large group of people greatly contribute to the social programs the government provides. One of the biggest services the taxes go into is healthcare. The revenue obtained also goes to balance each state’s personal budgets. Without the taxation of cigarettes, the United States would lose more than $7 billion that go towards beneficial programs and causes. The government collects more money from the sale of cigarettes than retailers, farmers, and manufacturers combined (NoCigTax).
Each level of government- federal, state, and local- use their tax revenues from cigarette sales on different things to improve the economy. Not only is it a good idea to tax cigarettes so that the United States can use that tax money elsewhere, but taxing a good that isn’t absolutely needed cuts down on the sales of tobacco products as well. There are some that think the taxation of cigarettes shouldn’t be allowed, but when viewed as a whole, it’s quite obvious that the positive effects of the taxation of tobacco outweigh the negative.
The taxes the federal government collect helps pay for many social programs, such as healthcare. This is a little ironic seeing as how cigarettes are proven to cause many health problems. A big chunk of the revenue of cigarette taxes go directly to the Children’s Health Insurance Program, which helps uninsured low-income families provide healthcare services for their children (eHow).
Taxation refers to the act of a taxing authority actually levying tax. Taxation as a term applies to all types of taxes, from income to gift to estate taxes. It is usually referred to as an act; any revenue collected is usually called “taxes.” The process whereby charges are imposed on individuals or property by the legislative branch of the federal government and by many ...
This is one of the positive effects of taxing these products. There are
many more positive effects as well. For example, at the state level, the taxes collected go towards balancing each state’s budget and fund the state healthcare services. Balancing the budget creates a stronger and more stable economy within each state. Some states, including California, haven’t raised their personal state taxes since before 1999. All that means is that they are collecting less revenue and not having a decrease in demand in the products. However, other states have increased the taxes, like New York, which has the highest state tax at $4.35 (tobaccofreekids).
This is an unbelievable increase over California’s tax rate, which is currently at only $0.88. At the local level, cigarette taxes are also in existence. The local tax revenue goes into general funds for various local projects (road maintenance, school renovations, community park remodels, etc).
Without cigarette taxes, these things might not be able to get fixed, or at least they wouldn’t be as high of a priority. Collecting taxes on cigarettes and tobacco, which are unfortunately very popular selling products, can help to stabilize the economy on state and local levels, and help to provide healthcare on a federal level. Cigarette taxes are crucial to our country.
Taxing cigarettes and other tobacco products is also helpful in trying to get people to stop buying. The tax that is placed on cigarettes is called an excise tax, which is a set tax for every person, no matter what their social standing or how much money they make. This is a good thing because not only is smoking a problem for people over the age of 18 who are legal to buy cigarettes and tobacco products, but young kids are smoking too. Younger kids don’t usually have or make as much money as older people who are legal to buy, so when taxes are raised, it causes them to have to cut back on buying as much of these products as they usually would. This is another positive effect of taxing these sorts of products. Every ten percent increase in cigarette prices reduces youth smoking by about seven percent and total cigarette consumption by about
Argument: Not taxing Internet Commerce would deprive state and local governments of Revenue that is essential to community services and projects. Yes, The Internet is the future. It is growing at a phenomenal rate and new businesses are popping up every minute. According to the Treasury Dept. , in 1998, approximately $7. 8 billion was spent over the Internet. However, they expect that number to ...
four percent (tobaccofreekids).
This is a very good thing because, as everyone is aware, cigarettes are a bad habit with numerous health risks. People, no matter what age, should be cutting back on smoking. For some of these people, the taxation on their cigarettes is just the push they need to stop buying the products. The tax, especially in the states that have the higher rates, help to decrease the demand and selling of these harmful products.
Though there are arguments of both the negative effects of taxation on cigarettes versus the positive effects, it’s quite obvious that the positive outweigh the negative. With the taxation of tobacco products come great improvements in the economy and well being of the United States. There is extra money from the revenue to put into health care for lower class citizens who otherwise might not be able to provide for themselves or their children, and there is room in state budgets to fix up and better their communities, schools, highways, and other maintenance issues. The other positive effect of taxing cigarettes is to help dissuade people from buying these products, especially younger people (including young adults who are both under and over the age of 18).
The extra money added to the price of their tobacco products make them rethink if they need the good or not, and in turn makes them healthier and help persuade them to quit. Taxation of cigarettes and tobacco products are definitely beneficial to the United States’ economy, and hopefully the rate will keep going up.