Cigarette Taxes Deter Heavy Drinking, Study Says

August 12, 2013 — 1 Comment

Trends in a recent study suggest that imposing a cigarette tax will decrease smoking; the study also shows that the cigarette tax effects alcohol consumption as well.

The new study, conducted by researchers from Yale, Stanford and the Roswell Park Cancer Institute in Buffalo, New York, and published in the journal Alcoholism: Clinical and Experimental Research, compared almost 11,000 people in 31 states that increased cigarette taxes between the 2001-2002 period and the 2004-2005 period, with a similar number of people from 15 states in which taxes remained the same.

Tobacco can enhance the subjective effects of alcohol and has been shown to increase the risk for heavy and problematic drinking. By raising cigarette prices, these taxes look to encourage smokers to cut their use or to quit and to discourage others from starting.

To put this all into perspective: in the study, male smokers drank about 10 percent less alcohol per session, and binged approximately seven fewer times per year in states with tobacco tax hikes, compared with male smokers who were not hit with the higher taxes.

“The protective effects were most pronounced among subgroups who are most at risk for adverse alcohol-related consequences, including male heavy drinkers, young adults and those with the lowest income” said corresponding author Sherry McKee, an associate professor of psychiatry at Yale University School of Medicine in a journal news release.

“[The results] are pretty consistent with behavioral economics concepts,” says the researcher.

It makes sense since these items are what economists called “complements”. Like chips and dip, cigarettes and alcohol go together. Often, when the price of one complementary good rises, consumption of the other falls.

According to McKee, though this study deals with complementary products, it does not prove complete cause and effect. This is because people may move from state to state and likewise, the survey used in the study was self-reported.

Think that smoking an e-cigarette might make a difference? Think again. Studies have shown “that when nicotine has been administered in other forms aside from cigarettes, or tobacco, researchers do see increases in drinking behavior.”

With the help of TurboTax, here are some infographics looking at different aspects of the U.S. cigarette tax.

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JDKatz: Attorney's At LawJDKatz, P.C. is a full-service law firm focused on tax law and estate planning. We are dedicated to minimizing your existing liability and risks while providing valuable tax planning to streamline your tax issues in the future. Please call us at 301-913-2948 to schedule an appointment to meet with one of our trusted attorneys.

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  1. A Taxing Issue for Smokers [infographic] « The Joy of Tax Law - August 13, 2013

    […] yesterday’s article on the cigarette tax? Below is an infographic with some more […]

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