Mayor Signs Cigarette Tax
"There's a significant tax and fee burden already on cigarettes," said a spokesman. "And when you raise the excise tax on cigarettes you're just creating incentives for adult smokers to find a lower tax option."
The University says the cancer research center could create up to 1,200 jobs by 2020. Mayor Suttle put that number closer to 10,000, hoping for off-shoot businesses the center could create.
Omaha, NE - Mayor Jim Suttle signed the city's new cigarette tax into law on Tuesday. It goes into effect in January, and raises the price by $0.15 a pack. The mayor's office projects it will raise $35 million over the next decade, to help fund a new cancer research center at UNMC.
It's similar to one the state of New Jersey passed in 2006. They taxed smokers $0.17 a pack, hoping for $30 million in revenue. Instead, sales statewide dropped by $22 million, because smokers turned to the internet and other places for cheaper tobacco.
We asked Mayor Suttle what happens to the tax if it doesn't raise the projected revenue. "I don't think that's the right story today," the mayor told KMTV Action 3 News. "And they're welcome to their hype and whatever they want to talk about."
Mayor Suttle is referring to the "hype" from cigarette manufacturer Phillip Morris, USA. Studies offered by Phillip Morris show when cigarettes are continuously taxed, smokers will find cheaper places to purchase tobacco.