The primary reason to increase the tax on tobacco is to get smokers to quit and dissuade kids from starting..

April 21, 2008 - The evidence is clear that increasing the price of cigarettes is one of the most effective ways to reduce smoking, especially among children. Studies show that every 10 percent increase in the price of cigarettes reduces youth smoking by about 7 percent and overall cigarette consumption by about 4 percent. There is no guarantee that every state that has significantly increased its cigarette tax will enjoy significant increases in revenue even while reducing smoking. In Iowa in the 12 months before the one dollar cigarette tax increase, the state took in just less than $91 million in tax revenues from cigarettes. That revenue jumped to just over $219 million in the last 12 months. That's a 142 percent increase. At this same time cigarette sales fall by 36%. In North Carolina Cigarette Sales Fell BUT Revenues from Higher Cigarette Taxes Increase.. In Wisconsin the January 2008 cigarette tax increase (from $0.77 to $1.77)is not generating as much revenue as expected. As Governor Jim Doyle's spokesperson pointed out - the most important part of the tax was to stop people from smoking (and stop young people from starting), even if the revenue is less. ( State cigarette tax millions short of earlier projections by Charles Brace, The Daily Cardinal, 4/14/2008) An analysis of recent tobacco tax increases conducted by Altria, the parent of Philip Morris USA Inc., concluded that three-fourths of them had raised less money than projected. Since 2002, 43 states and the District of Columbia have enacted 76 distinct tobacco tax increases, raising the average state tax to $1.13 from 61 cents, according to the Campaign for Tobacco-Free Kids. The R. J. Reynolds Tobacco Company estimates that state taxes now generate $14.5 billion in revenue, while the federal excise tax of 39 cents a pack raises $7.3 billion. References: States Look to Tobacco Tax for Budget Holes by Kevin Sack, The New York Times, 4/21/2008; , New Report: Increasing Massachusetts' Cigarette Tax Will Reduce Smoking, Save Lives and Save Money, PR Newswire, 4/7/2008; Fired up over cigarette tax Philip Morris tries to rile smokers into action, by Jay Fitzgerald, BostonHerald.com, 4/18/2008; Cigarette-tax strategy could backfire on states, by Richard Craver, 4/11/08. Of immediate interest: R.J. Reynolds Tobacco launches web site to help retailers and other opponents fight tobacco taxes... Click on image to enlarge.. (TobaccoWatch.org)