Missouri’s tobacco tax proposals: Are the current proposals better than nothing?

‘Tis better to do nothing than to do something stupid.

Two proposals are being circulated for placing tobacco tax increases before Missouri voters on the November 2016 ballot. Each proposal will need to collect upwards of 100,000 signatures before the May 8 filing deadline. Neither initiative is effective in impacting price-sensitive choices of young smokers. Both use tax funding for unrelated and popular work. Tax-supported entities have become perversely reliant on such taxes to fund such non-tobacco related activities. Importantly, these also carry the potential to blunt attempts to decrease smoking.

Sponsored by the Missouri Petroleum Marketers & Convenience Store Association. These stores are large sellers of off-brand cigarettes. 

  • It will raise the price of cigarettes by 6 cents per year for four years, resulting in a total $0.40 per-pack tax.
  • It has a “poison pill” provision such that any future attempt to raise the cigarette tax will cause this tax to cease—effectively giving a discount to any future efforts.
  • This proposal does not correct the Master Settlement Agreement loophole leaving the state with a loss of tobacco funds of up to $50 million per year.
  • The tax dollars are dedicated to transportation funding and are expected to raise about $80 million per year. The transportation needs of the state are estimated to be $600 million to $1 billion annually.
  • Transportation advocates are concerned the inadequate amount of funding will cloud issues for a more comprehensive solution.


Raise Your Hands for Kids. This organization serves as the fundraising and advocacy arm of the Shawnee, Kansas-based Alliance for Childhood Education, a coalition of business leaders committed to improving the education systems in Missouri and Kansas. RYHK has wide support among Missouri child advocacy groups. In its December 2015 campaign finance report, RYHK reported receiving a $1 million donation from RJ Reynolds, manufacturer of Camel cigarettes. 

  • This constitutional amendment will raise the price of cigarettes by 15 cents per pack for four years, resulting in a total $0.77 per-pack tax by 2020.
  • The tax dollars will be dedicated to early childhood services, which can include preschool or other health services as identified by each of the 115 counties in the state. Up to 10 percent will support smoking cessation and prevention programs and another 10 percent will support hospital-based early childhood health programs.
  • This proposal also has an excise tax on off-brand cigarettes of 67 cents per pack.
  • There has not been a legal determination on whether this will close the Master Settlement Agreement loophole, or whether the state can continue to receive the revenue that would be paid by large tobacco manufacturers.


These proposed changes will have a minimum effect on smoking behavior. The absolute minimum “dose” of tobacco tax needed to affect youth smoking is 10% of the purchase price, or 52 cents per pack, all at one time. In order to make a real impact on the behavior of our price-sensitive teens and young adults, a more realistic goal is 75 cents. Phased-in taxes are much less effective because consumers adjust their budgets to accommodate them. In the unlikely event that no other state in the U.S. raises tobacco taxes in the next four years, a 52-cent increase would improve Missouri’s standing from 51st in the nation to 38th, between Mississippi and Alabama. Getting to the middle of the pack for state taxes, 26th in the nation, would mean an increase of $1.37 per pack.

It is difficult to raise the cigarette tax in Missouri. Despite three attempts, the rate has not been adjusted in 23 years. If either of these bad proposals pass, a meaningful increase in the future will be even that much harder. Proposal #1 would, if passed, add future burdens by challenging transportation funding. Proposal #2 would add future burdens by challenging early childhood health funding. Both initiatives appear to be cynical attempts to encumber needed and popular programs with a tobacco Trojan horse.

Because of the unique ability of tobacco taxes to effect health change, they need to be used wisely. The hopelessly flawed current proposals are a perfect example of situation in which passing something is worse than passing nothing. Putting it another way, ‘tis better to do nothing than to do something stupid.

Michael O’Dell, MD, MSHA, is chair of the Department of Community and Family Medicine at the University of Missouri-Kansas City School of Medicine, and associate chief medical officer for the Truman Medical Centers Lakewood campus. He served as 2015 president of the Kansas City Medical Society.

This post originally appeared in Kansas City Medicine, Spring 2016 edition.

Policy, Tobacco

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