Study finds Md. tax increases on cigarettes, alcohol improved public health

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Pholo by kevygee with Flickr Creative Commons License

By Glynis Kazanjian

For MarylandReporter.com

Researchers from Johns Hopkins University want lawmakers to use tax increases as a strategy to improve public health after a study they conducted showed declines in alcohol and tobacco usage when Maryland raised taxes on both.   

The report, “Public Health Policy in Maryland:  Lessons from Recent Alcohol and Cigarette Tax Policies,” showed a decreased use in both products and improvements in people’s health after taxes on a pack of cigarettes increased from $1.00 to $2.00 in 2008 and taxes on alcoholic beverages increased from  6% to 9% in 2011.

The study was commissioned by the Abell Foundation, a Baltimore organization with a mission to improve the quality of lives for underserved populations.

“This report allowed us to investigate the effect that targeted tax legislation had both on improving health outcomes related to cigarette smoking and alcohol consumption, and creating the revenue needed to further address health challenges,” said Terry Staudenmaier, senior program officer for health and human services at the Abell Foundation. “The findings prove that this type of legislation is an effective public health tool in Maryland.”

Among some of the key findings, the study showed a drop in binge drinking and alcohol consumption among youth.

Reduced binge drinking

According to the report, from 2011 to 2015, there was a 26% reduction among Maryland high school students who consumed alcohol at least once in a preceding 30-day period. Comparatively, the study showed a 17% reduction among students nationwide.

During the same time period, binge drinking among youth reduced 28% and students who reported riding in a vehicle driven by a person who had consumed alcohol dropped 31%. Binge drinking is defined as having five or more consecutive drinks.

Among Maryland adults, from 2011 to 2016, binge drinking dropped 17% in Maryland, compared to 6% reduction nationwide.

“The relationship that is evident across studies is clear: As the price of alcohol increases, death and injury decrease generally, with specific declines in alcohol-related diseases, violence, traffic crashes, and crime,” the report states.

The study also found that Maryland retailers sold 182 million packs of cigarettes in 2015 compared to 269 million packs sold in 2007.

Upon passage of the 2008 cigarette tax, revenues increased by $72 million from $268 million in 2007 to $340 million in 2008. In 2016, the state collected $360 million.

“The number of smokers has continued to drop every year since the tax increases went into effect,” Staudenmaier stated.

Youth smoking declines

The percentage of youth smokers who reported smoking at least once in a previous 30-day period decreased from 17% to 9% from 2007 to 2015. The study also found that young adults who do not start smoking in high school are less likely to smoke as adults and are less likely to use illegal substances when compared to peers who smoke.

Researchers noted that alcohol and cigarette usage are linked to a number of public health problems, including driving under the influence, sexually transmitted diseases that cause cancer and cardiovascular and respiratory diseases.  

“There was a decrease in alcohol-positive drivers and in sexually transmitted infections in Maryland,” the report states.

In addition, researchers pointed out that smoking is the leading cause of death in Maryland, noting that 7,500 die each year from smoking-related diseases.

Cherry-picked data

Marc Kilmer, a senior fellow at the Maryland Public Policy Institute, called the report a simple analysis and said the authors cherry picked data.

“I think it oversells the effects of these two tax increases on these two products to bolster the advocacy this group is predisposed to support,” Kilmer said. “It attempts to link a variety of health effects from both alcohol and cigarette to these two tax increases, whereas people’s actions depend on a variety of factors — to cultural norms and federal policies and, of course, the price of something plays a role in that.”

Kilmer said he thinks the study misses the business affects of the taxes.

Cross-border sales

“I think there was evidence before Maryland raised the cigarette taxes that people would come into the state to buy alcohol, and now there’s evidence that that’s reversed direction,” Kilmer said. “I live by a ‘Tax Free Liquor’ store on the Maryland-Delaware border. It’s not named that out of coincidence.

“There are definitely cross-border sales of alcohol and tobacco. Maryland is the state where the vast majority of residents live very close to other jurisdictions where there’s different tax policy on alcohol and tobacco. The idea that Marylanders haven’t shifted their buying habits is pretty naive.”

Daraius Irani, chief economist for the Regional Economic Studies Institute at Towson University, said “sin taxes” are a good approach to changing behavior of individuals.

“The outcomes mentioned speak strongly to the impact that these policies can have on improving public health.”

  • ELAINE WILLIAMS

    I don’t believe one word of this. What study? What was the study design? Who sponsored (paid for) this “study.” Seems to me that this ‘study’ is designed around ‘higher taxes are good for your health” point of view.

    Gee I don’t know could it be that people are smarter and making smarter choices. Smoking and drinking are not vices that we can tax our way out of. Kind of like arresting our way out of heroin addiction. It’s not working.

    I doubt seriously that people are healthier because of higher taxes. Knowing what I know about the underhanded ways Maryland is politically mismanaged this “study” just doesn’t wash with me.

    • lenlazarick

      The second paragraph of the story contains a link to the full study which answers all your questions in your first paragraph.

      • ELAINE WILLIAMS

        Len be that as it may – the headline was extremely misleading. I saw the second paragraph but had already guessed that factoids were cherry picked as was stated — but how many people do you think actually read a full article? Any time the truth is sought it’s really best just to follow the money – i.e. who is funding what study, who is funding what politicians campaign, who is paying exorbitant lobbying fees, in short who is buying political influence.

        • lenlazarick

          The headline was not misleading. You disagreed with the study, soyou didn’t like the headline People who want to be informed read the whole article, even the study itself. So far about 300 people read the story for an average of four mintues, meaning they read most of the artucke, The article accurately portrayed what the study said, and sought comments to balance it. It’s an old statement that when you tax something, you get less of it.

  • Herb Cromwell

    Nice to know that the tax increases are improving public health as intended. All credit to Health Care for All and other advocates. As one of the mental health reps involved in the 2011 legislation, however, I must point out that mental health and addiction services have received no direct benefit from the alcohol tax. The original bill, named for Lorraine Sheehan, would have allocated 15% of annual proceeds to each of these critical areas. The amended bill (actually a whole new one crafted by leadership at the end of the session) deleted this provision. Most of the new revenue goes to school construction. Given the opioid crisis, behavioral health sure could use the money.