Increasing cigarette taxes and other tobacco product OTP taxes is a WIN, WIN, WIN solution for Michigan

1. Increasing cigarette taxes and other tobacco product (OTP) taxes is a WIN, WIN, WIN solution for Michigan! A win for public health A win for state budgets A win among voters Comprehensive tobacco prevention programming is essential for saving money and saving lives!

2. Community Objectives Provide presentation to your coalition and one community group Submit two LTE to your newspaper Send postcards to your legislator, Gov., Lt.Gov. Distribute posters in your community Meet with your legislator Deliver legislative one-pager/talking points Determine level of support/concerns Complete Contact Log and send to Regina Send thank you following meeting, and provide follow up information as requested

5. State Cigarette Tax Rates Average cigarette tax rate: $1.29 per pack 14 states with tax rates at $2.00+ per pack: Another 13 states have tax rates of at least $1.00 per pack:

7. TOBACCO EXCISE TAXES Why are they such a good idea? Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

8. TOBACCO EXCISE TAXES A win for public health A win for state budgets A win among voters Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

9. EFFECTS OF A 10% INCREASE IN THE PRICE OF TOBACCO Nearly 7% decline in youth prevalence A 2% decline in adult prevalence A 4% decline in overall consumption Funding comprehensive tobacco programs increases the decline. Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

12. �The single most direct and reliable method for reducing consumption is to increase the price of tobacco products, thus encouraging the cessation and reducing the level of initiation of tobacco use�National Academy of SciencesInstitute of Medicine1998 Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

13. �It is clear that price has a pronounced effect on the smoking prevalence of teenagers and that the goals of reducing teenage smoking and balancing the budget would both be served by increasing the Federal excise tax on cigarettes.� Myron JohnsonPhilip Morris Research Executive1981 Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

14. The President�s Cancer Panel�s 2007 report, Promoting Healthy Lifestyles �Increases in tobacco excise taxes, which are passed along to consumers in the form of higher tobacco product prices, have proven highly effective in reducing tobacco use by promoting cessation among current users, discouraging relapse among former users, preventing initiation among potential users, and reducing consumption among those who continue to use tobacco. These revenues also provide crucial dollars needed to fund anti-tobacco efforts.�

15. TOBACCO TAXES ARE MOST EFFECTIVE WITH: Kids Lower Income Populations Ethnic Minorities Pregnant Women Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

16. TOBACCO TAXES AND PREGNANT WOMEN 10% increase in price produces 7% decline in smoking This is 3-4 times the effect as among smokers in general Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

17. TOBACCO TAXES AND STATE REVENUES Despite inevitable declines in consumption of cigarettes � Increasing tobacco taxes ALWAYS increases state revenues Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package Show tax ads from Pete -- transparencies How can we influence price. We do it by supporting public policies (i.e. excise tax increases) that effectively raise the price of cigarettes and other tobacco products. Economic research shows that price influences consumption � particularly for kids. We have supported tax increases at the federal and state level through: Advertising in support of the tax increases Direct lobbying Grassroots organizing � letter writing, visits, etc. In 1997, we saw state excise tax increases in 8 states. In Alaska, the increase was from 29 cents to a full dollar, now the highest cigarette tax in the country. We�ve also supported the Hatch - Kennedy proposal to increase the federal excise tax to fund health insurance for uninsured kids. Our support for package

20. CIGARETTE TAX INCREASES WORKING Indiana: 17% consumption decline since 2007 increase of $.45/pack Wisconsin: 20,000 quitline callers since 2007 passage of $1/pack increase

21. Taxes Drive Cessation

22. Tobacco Taxes Dealing with Common Opposition Arguments

23. Main Opposition Arguments Tobacco taxes will increase smuggling Smuggling will bring organized crime to North Dakota and fund terrorism People will just buy cigarettes over the internet rather than quit People will just switch to cheaper brands Raising the tax will cause people to buy their cigarettes on a reservation or in another state (and then also go somewhere else to buy gas, groceries, and just about everything you can imagine) Tobacco taxes target the poor

24. Tobacco Taxes:Not Perfect but Successful The big picture: Opposition arguments are not all without factual basis, however they are typically exaggerated and removed from context. Bottom line: Tobacco tax increases have never failed to raise state revenues while reducing consumption.

25. STATE OPTIONS TO PREVENT AND REDUCE CIGARETTE SMUGGLING Create measures to make smuggling and tax avoidance more difficult Tax stamps and other technology Create stronger disincentives and punishments for smuggling Increase enforcement

26. OPTIONS TO REGULATE INTERNET SALES States have passed two kinds of internet regulation laws in recent years Regulatory approach (pushed by Phillip Morris) that if done correctly helps states collect taxes and verify age of purchasers Internet Sales prohibition State have also pursued aggressive tax collection on �tax cheats� Federal Regulation: Legislation introduced in past sessions, expect it to be introduced again

27. STATE OPTIONS TO COPE WITH TRIBAL SALES The Washington State Example: Establishing a tribal compact The New York example: Revenues still went up and smoking still went down (this needs updating, they are being very aggressive now with tribes)

28. Cigarette Taxes are Regressive and Hurt Poor People Cigarette Companies have it backwards: It is the harms from smoking that are regressive. Lower-income communities and people already suffer disproportionately from smoking related disease, disability, death and costs. Most of those who quit and cut back are lower income smokers who will save money and improve their health. Polls consistently find support for tobacco tax increases among lower income communities.

29. WITH NEW & FLAVORED PRODUCTS In recent years, tobacco companies have introduced an array of new products and variations on old ones: Flavored Cigarettes Smokeless Tobacco Little Cigars many in flavors appealing to youth and young adults: Candy (Bubble gum) Fruit (Sour apple) Alcohol (Scotch)

30. �OTP� Revolution �OTP�= Other Tobacco Products (everything but cigarettes) OTP sales grew 11.7% in retail sales in convenience stores in 2007 Cigar revenue up 15.9%, moist snuff revenue up 9% http://www.othertobacco.com/art-growthdrive.html

31. Go over flavors Go over flavors

32. Spit Products

33. New smokeless, dissolvable tobacco products from R.J. Reynolds

34. There is even an extension of Phillies Cigarillos called Sugarillos that is marketed for �when sweet isn�t sweet enough.�There is even an extension of Phillies Cigarillos called Sugarillos that is marketed for �when sweet isn�t sweet enough.�

35. In fact, these cigars were mistaken for candy by a child in DC. Tell story. In fact, these cigars were mistaken for candy by a child in DC. Tell story.

36. Little and Big Cigars Rapidly growing market share Products virtually identical to cigarettes taxed at much lower rates Definition of cigar is based on paper vs a tobacco wrapping Fun flavors for the kids

37. Manipulating nicotine levels: Starter products that won�t make your kid puke Higher nicotine premium products to keep established addicts hooked

38. Increased Nicotine Levels in CigarettesAverage Nicotine Yields Per Cigarette 1997-2005Harvard School of Public Health, 2006 Recent study showing the increase in nicotine levels in cigarettes after the MSA. Recent study showing the increase in nicotine levels in cigarettes after the MSA.

39. UST�s Graduation Strategy Nicotine levels are also manipulated in smokeless products. Bandits are in pouches, lower in nicotine, milder in flavor Copenhagen is higher in nicotine, loose long cut tobacco and stronger � flavors are not sweet. Nicotine levels are also manipulated in smokeless products. Bandits are in pouches, lower in nicotine, milder in flavor Copenhagen is higher in nicotine, loose long cut tobacco and stronger � flavors are not sweet.

40. Comprehensive tobacco prevention programming is essential for saving money and saving lives! Increasing cigarette taxes and other tobacco product (OTP) taxes is a WIN, WIN, WIN solution for Michigan - a health win that reduces smoking and saves lives; a fiscal win that raises revenue and reduces health care costs; and a political win that is popular with the public.

41. Contact info: Jim Harrington jharrington10@gmail.com 989-619-4204 www.tobaccofreemichigan.org