Cigarette Tax to Fund Healthcare, Tobacco Use Prevention, Research, and Law Enforcement.
"California Healthcare, Research and Prevention Tobacco Tax Act of 2016"
initiative constitutional amendment & statute
*PASSED*
Official Summary
Increases cigarette tax by $2.00 per pack, with equivalent increase on other tobacco products and electronic cigarettes containing nicotine.
Fiscal Impact: Additional net state revenue of $1 billion to $1.4 billion in 2017–18, with potentially lower revenues in future years. Revenues would be used primarily to augment spending on health care for low–income Californians.
- Official CA Voter Guide Summary
- Legislative Analyst Office Analysis
- Show Me The Money (as of Oct 22)
- support: $29,800,000
- oppose: $66,300,000
- Ballotpedia Summary
Notes
- tax on cigarettes, tobacco products (cigars, chewing tobacco, products containing at least 50% tobacco) and e-cigarettes (battery operated devices that turn liquid that may contain nicotine into a vapor)
- tax is actually paid to the Board of Equalization by the distributor, to receive the CA tobacco tax stamp, and they pass the cost on to the consumer
- current CA cigarette tax is 87 cents/pack cigarettes, equivalent to $1.37 for other tobacco products; national average is $1.60
- current federal tax on cigarettes is $1.01/pack
- plus sales tax (7.5%-10%)
- average cost $6/pack
- in 2013, 12% of CA adults smoke cigarettes, 4% e-cigarette users
- adds e-cigarettes in definition of "other tobacco products"
- also adds excise tax on distributors of $0.10 for each cigarette, $2.50 for products with '25' CA cigarette stamp, $2 for '20', $1 for '10' (including inventory on the first day of the quarter after this is enacted)
- use of funds:
- replace revenues lost due to lower tobacco consumption (1988's Prop 99, 1998's Prop 10, state and local sales tax decreases)
- 5% max - cost to administer the tax
- $30 M - law enforcement of tobacco-related laws
- $6 M - board to enforcetobacco-related laws
- $6 M - DPH for tobacco-related law enforcement support
- $6 M - Attorney General for tobacco-related law enforcement
- $40 M - UC physician training
- $30 M - DPH dental disease prevention education
- $400 k - adit of agencies receiving funds
- 82% of remaining - Medi-Cal
- 11% of remaining - California Tobacco Control Program - DPH - tobacco prevention and control programs
- 5% of remaining - UC tobacco related disease research
- 2% of remaining - school programs to prevent and reduce use of tobacco products by young people
- exempt from Prop 98 education funding requirement