California Voters Narrowly Reject Tobacco Tax Increase

Voters in California turned back an effort to add $1 to the cost of a pack of cigarettes. The rate increase would have been the first one in California since 1998. Without the increase, California’s 87 cent tax remains well below the current national average of $1.46 per pack.

Revenues from the tax, Proposition 29 on California’s June 5 ballot, would have supported medical research on tobacco related diseases and programs to prevent and control tobacco use. First year collections were estimated at $735 million.

Observers credit the narrow defeat – 50.8 percent to 49.2 percent – to heavy spending by opponents to the tax increase. Estimates of spending are as high as $47 million. Early polls showed support for the tax increase, but a heavy blitz of advertising cast doubt on where the revenues would be spent. Despite the support of media stars like bicyclist and cancer survivor Lance Armstrong, the measure fell just as an earlier effort in 2006 did.

Source: Campaign for Tobacco Free Kids, accessed June 7, 2012