Cigarette tax revenues drop as vaping increases

Every cigarette in St. Joseph includes a little something extra for Uncle Sam, the state of Missouri and city government.

This “sin tax” amounts to roughly $1.23 per pack purchased in the city limits. But does a sin tax still serve its purpose if fewer and fewer people are committing the offense?

State and city data show a steep drop in tobacco tax revenue in the last decade, as smoking rates declined and some younger people turned to electronic vapes that aren’t subject to a tobacco tax.

City tobacco tax revenue has dropped 27 percent since 2009, to an estimated $319,000 in 2019 on a tax that amounts to 5 cents a pack. Missouri’s receipts have dropped 10 percent in a similar time period, to $99 million in 2019. That state portion of the tax is 17 cents a pack, the lowest rate in the nation.

Since tobacco taxes are enacted to change behavior as much as generate revenue, health advocates see this decline as a positive step.

“It tells us people are either quitting or not starting,” said Leah Martin, director of advocacy and tobacco control for the American Lung Association in Missouri, Kansas and Nebraska. “A decrease in revenue shows there has been a decrease in smoking.”

The American Lung Association released statistics that show St. Joseph’s adult smoking rate at 25 percent. That’s down from recent years but still higher than the state rate of 20.8 percent and the national rate of 17 percent. Some are starting to ask what kind of role vaping plays in this decline.

Ron Bachman, owner St. Joe Petroleum, describes cigarette sales as significant but declining in his company’s chain of popular Fastgas stores in the St. Joseph area. “It’s hard to tell if it’s because of vaping,” he said. “I really don’t think it’s eating into it that much.”

The U.S. Surgeon General labeled e-cigarettes as an epidemic after high school usage increased 78 percent in 2018. At some local tobacco and vape stores, employees noted a clear trend of younger customers preferring vapes and older smokers buying traditional cigarettes.

“People are smoking less cigarettes. More people are vaping,” said Chris Prudden, owner of The Torch and Nail on Alabama Street. “I don’t know how long it’s going to last. I definitely sell a lot of battery accessories. It’s probably 30 percent of my business, at least. It wasn’t that in the beginning at all.”

Vapes, though, occupy a nebulous world with a different tax and regulatory structure than traditional cigarettes. The Food and Drug Administration didn’t issue regulations for e-cigarette products until 2014. It took two more years for the agency to restrict sales to consumers 18 and older — a rule that many teens get around — and some companies haven’t fully complied with requirements that manufacturers disclose the ingredients in an e-cigarette.

The state followed the same playbook, passing a law that e-cigarettes don’t have to be regulated like a tobacco product.

Now, health organizations are pushing back and demanding that e-cigs, which have been linked to more than a thousand serious lung illnesses nationwide, face government oversight more in line with a traditional cigarette. The St. Joseph City Council takes a step in that direction with a vote Monday on whether to include e-cigarettes in St. Joseph’s indoor smoking ban.

“A lot of local municipalities have adopted ordinances that define it as a tobacco product,” Martin said. “We would like to see more funding for prevention and regulation.”

Greg Kozol can be reached


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