Letter: Fears of tobacco black market are unfounded
In a recent article in the Daily Globe ("In border town, Dayton's budget faces skepticism"), it was noted that there are some concerns over raising the tobacco tax because of fear of a black market developing.
This is a common, yet false, argument put forth by the tobacco industry to build their case against tobacco tax increases. The same type of argument was used when Minnesota passed its smoke-free law, which proved to be untrue.
The fact is that every single state that has significantly increased its state cigarette tax rate has experienced substantial increases in state revenue -- despite the consumption declines prompted by the tax increase and any related tax avoidance, black market sales or smuggling. The smuggling/tax avoidance problem is a lot smaller than the cigarette companies and their allies would have you believe. Indeed, research has shown that the vast majority of smokers prefer to buy cigarettes by the pack but cross-border purchases involve multiple cartons.
Tobacco is addictive and deadly, but statistics show that increasing the price helps motivate people to quit or not start in the first place. And it is estimated that a $1.50/pack increase in the tobacco tax would save 25,700 Minnesota lives and would save about $1.65 billion in long-term tobacco-related health costs in Minnesota.
Clearly, the benefits of raising the price of tobacco outweigh any illegal or tax avoidance activities that may take place. The only ones who stand to make money if the tax stays low are the tobacco companies.