Cigarettes Become Very Expensive in US After Federal Tax Triples

The cost of lighting up in the United States skyrocketed Wednesday under a federal tax hike on tobacco to fund new health care coverage to uninsured children.

The federal tax on a pack of cigarettes more than tripled to more than one dollar, from 39 cents, the Treasury Department said. For a 10-pack carton, the tax leapt to 10.06 dollars from 3.90 dollars.

Taxes on all other tobacco products increased. Some of the largest hikes were on roll-your-own tobacco, raised to 24.78 dollars per pound from 1.09 dollars, and small cigars, to 50.33 dollars per 1,000 from 1.82 dollars.

The tobacco tax hikes were part of the Children's Health Insurance Program Reauthorization Act signed into law by President Barack Obama on February 4.

Obama touted the law as a "down payment" on his vow to guarantee health benefits to all Americans.

Former president George W. Bush twice vetoed similar legislation.

The law expands health care to an additional four million children over the next four and a half years while continuing coverage for about seven million children.

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The 32.8-billion-dollar boost is mostly funded by the tobacco tax hikes, which supporters hope will discourage more than one million children from taking up smoking.

In a broad tightening of government regulation of the tobacco industry, the law provides for new permit and enforcement provisions on tobacco products and processed tobacco.

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Source-AFP
SRM