State snubs smoking, not its taxes
It's the ultimate mixed message: Alabama government spends money to encourage people not to smoke, but it relies heavily on cigarette taxes to fund prisons, mental health centers and other important functions of government.
Cigarette taxes are the third biggest tax source for the state General Fund budget. Alabama's property taxes, which are the lowest in the nation, rank fifth.
"It's amazing in this state that we have campaigns to encourage people not to smoke, but we rely more on cigarette taxes than property taxes," said Rep. John Knight, chairman of the House Government Finance and Appropriations Committee.
Alabama is not alone. Cigarette taxes are big revenue producers in most states. . . .
Some states have raised their taxes over $1 per pack and that hasn't reduced consumption. One economic study found that taxes would have to exceed $7 per pack before people would give up the addictive habit due to high taxation, Beeson said.
Alabama's budget for helping people stop smoking is tiny compared to the revenue the state gets from cigarettes.
The budget, $682,000 for the current fiscal year, ranks 46th among the states and is 2.6 percent of what the Centers for Disease Control recommends that Alabama should spend for a first-rate program. . . .
While cigarettes are a big revenue source for the state, Beeson likes to flip the numbers around and look at how much smoking-related illnesses cost the state: an estimated $1.38 billion a year.
"When you look at what it costs us and what we get back, it's a huge gap," she said. "Our medical expenses far exceed our taxes."
