The single largest federal tobacco tax increase ever goes into effect tomorrow (Wednesday, April 1). The tax will jump from 39 cents to $1.01 a pack. The increase will finance a major expansion of health insurance for children. The Arizona Daily Star reports that both public health advocates and the tobacco companies are trying to turn the situation to their advantage. Cigarette prices have already gone up to help offset any drop in profits. Medical groups say a tax hike in the middle of a recesssion is a great incentive to get smokers to quit.
Other tobacco products will also see large tax increases.
Congress is also considering legislation to give the Food and Drug Administration the authority to regulate tobacco. That could lead to reformulated cigarettes.
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