Boston – Raising the cigarette tax in Southern states by $1 per pack would help ease the economic crisis that weighs heavily on the region and its hard-working families, and would also improve the health of its residents, according to a report released today by the American Cancer Society Cancer Action Network (ACS CAN) and Community Catalyst. The report, “Big Benefits from $1: Raising Cigarette Taxes in the South to Boost Health and the Economy,” is supplemented by a new Web-based interactive tool that details state-by-state benefits of a $1 tax increase.

In the current economic crisis, the Southern states have been particularly hard hit by budget shortfalls and high rates of tobacco-related diseases that are costly to treat, yet easy to prevent.  The region also has an increasing number of families without health insurance or who are at risk of losing coverage from budget cuts and job losses.

“It has been proven that a cigarette tax increase boosts both public health and economic development. The higher the price of tobacco, the more health benefits will accrue for young people and adults,” said Daniel E. Smith, president, ACS CAN. “The current economic crisis provides a unique opportunity for lawmakers across the South to rise above partisan politics and take decisive leadership on an issue that will not only ensure revenue for critical health programs like Medicaid but will also positively impact the health of their constituents.”

According to the report, a $1 per pack increase in each of 13 Southern states – Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Texas, Virginia and West Virginia – would raise nearly $3.3 billion in the first year alone for cash-starved state budgets, bolstering the regional economy.

If used to fund health insurance through state Medicaid programs, the money would ensure that hundreds of thousands of families get the health care they need and would help secure as much as $35 billion in matching federal funds for the South in the first two years.

“Medicaid funding supports health care providers – doctors, hospitals and health centers – in every community.  This investment multiplies as Medicaid spending ripples through state economies, spurring additional business activity, as health facilities buy supplies and health care workers spend their wages,” said Susan Sherry, Community Catalyst’s deputy director. “The investment is multiplied again and again, reaching every corner of every state.” 

According to the report an increase of the cigarette tax by $1 across all 13 Southern states would:

• Reduce smoking and smoking-related costs. More than 559,000 adults and 153,000 youths would quit or not start smoking, and hundreds of thousands would be saved from premature deaths. Increasing funds for smoking cessation and prevention would boost these benefits, and Southern states would also save billions in health care costs.

• Protect access to health care. Using the $3.3 billion raised annually by the tax increase to fund Medicaid would ensure that hundreds of thousands of low-income families can get the health care they need.

• Bolster the economy. Spending the tax money to shore up Medicaid would protect federal matching funds of $6 billion a year, and attract up to $23 billion more in matching money through 2010. This would protect more than 119,000 jobs and billions of dollars in consumer and business spending.

The effort to raise the cigarette tax by $1 is part of a wave of action across the South that is supported through a new partnership of Community Catalyst, a national non-profit organization working to ensure quality, affordable health care for everyone, and ACS CAN, the advocacy affiliate of the American Cancer Society. The partnership aims to help Southern states raise cigarette taxes to improve the health and the economy of the region.  

ACS CAN and Community Catalyst’s regional report and the online map of the Southern states highlight the positive impact of a $1 per pack increase in the cigarette tax.  The map allows easy comparisons across the states and includes the voices of some local consumers who support the tax increase.

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ACS CAN, the nonprofit, nonpartisan advocacy affiliate of the American Cancer Society, supports evidence-based policy and legislative solutions designed to eliminate cancer as a major health problem. ACS CAN works to encourage elected officials and candidates to make cancer a top national priority. ACS CAN gives ordinary people extraordinary power to fight cancer with the training and tools they need to make their voices heard. For more information, visit

Community Catalyst is a national non-profit advocacy organization dedicated to making quality, affordable health care accessible to everyone.  Since 1997, Community Catalyst has worked to build consumer and community leadership to transform the American health care system. With the belief that this transformation will happen when consumers are fully engaged and have an organized voice, Community Catalyst works in partnership with national, state and local consumer organizations, policymakers and foundations, providing leadership and support to change the health care system so it serves everyone—especially vulnerable members of society.