Cigarette prices skyrocketed Saturday after Proposition 56 went into effect, raising the state tax to $2 per pack along with an increase to other tobacco products.
The main intent of the California Healthcare Research and Prevention Tobacco Tax Act of 2016, approved by voters in November, was to make tobacco products so unaffordable it forces smokers to quit.
That was proving true Saturday as smokers in Los Banos started going to tobacco stores with an eye on the price.
“It’s definitely gonna affect me,” said Los Banos resident Chad Alves. “It’s motivating me to quit.”
Alves said many of his friends who smoke also said the same thing.
The new law passed with 63 percent of the vote in November. With the state tax rate moving from 87 cents to $2.87, the state is estimated to bring in anything from $1 billion to $1.4 billion in tax revenue, most of which is earmarked to go toward health care for low-income state residents and smoking prevention.
A smoker who takes in one pack per day is looking at about an extra $60 per month, or $720 per year as a result of the tax increase.
The increase makes California ninth for highest cigarette tax in the country. New York’s tax is at the top with $4.35 per pack.
The proposition is the second measure to deter smoking in the last two years. Last year, state legislators raised the tobacco purchasing age from 18 to 21, tightened loopholes on workplace smoking bans, and designated K-12 campuses as smoke-free zones.
“Yesterday, a customer was saying that was his last pack, his last carton,” said Dave Singh, owner of Cigarette Outlet at 1341 E. Pacheco Blvd.
Other customers have said they may switch to e-cigarettes, which are also being taxed under the new law.
Excise taxes on non-cigarette tobacco products, such as cigars, chewing tobacco and snuff, are expected to more than double to 66 percent of the wholesale cost.
Singh said the tax increase will likely be a blow to his business because he expects his clientele to either cut back or quit altogether. But he wasn’t going to give up on the store, which reflected the noticeable price hikes on cigarette packs Saturday.
“It will definitely slow down,” he said, adding that he may try to soften the blow of the tax on his customers by cutting the store’s margin to keep prices competitive.
While health advocates are chalking up the law as a good step in the right direction, opponents have aimed at where the money is going, claiming the allocation doesn’t go far enough to help smokers or prevent children from smoking.
Vikaas Shanker: 209-826-3831, ext. 6562