Many years ago, I was a two pack a day smoker. I was young.
I gave up the habit more than 20 years ago as a gift to the hubby. Despite a few extra pounds, it's turned out to be a good gift to myself, too.
If you're still smoking, you might want to stock up on your favorite brand today. By this time tomorrow, they will cost 62 cents more per pack.
The federal tobacco excise tax increases from 39 cents a pack to $1.01 per pack on April 1. That's the single largest federal tobacco tax increase ever.
Adding to smokers' fiscal woes, in advance of the tax hike, the Associated Press says that the major cigarette makers raised prices a couple of weeks ago, partly to offset any drop in profits they expect once the tax increase takes effect.
Will folks quit? Medical groups see a tax increase right in the middle of a recession as a great incentive to help persuade smokers to quit.
Personally, I've never known a smoker to quit or even cut back because of the price of the product. Maybe they bum a few more cigarettes, but if money gets tight, smoking is one of the last things to go.
Maybe it's because for most folks, it's a very addictive habit. I'm lucky. Once I finished my last pack, I just never lit up another one, so obviously I have no physiological issues. But I still sometimes miss smoking, and that release is what people aren't going to give up, especially when they are worrying about things.
So even if one of those worries is financial, they'll find a way to hang onto the soothing habit and cut back elsewhere.
Not just cigs: Other tobacco products, from cigars to pipes and smokeless tobacco, also will face large tax increases tomorrow. The tax on chewing tobacco, for example, will go from 19.5 cents per pound to 50 cents.
The Alcohol and Tobacco Tax and Trade Bureau, a division of the Department of the Treasury, has put together a table showing the various impending tax increases.
So why the tax hike? Dollars.
The tobacco tax increases will go to pay for a major expansion of the State Children's Health Insurance Program, or S-CHIP. The previous Administration resisted funding for the program because of the tax increases involved.
However, President Barack Obama, himself a smoker, signed the S-CHIP measure shortly after taking office.
Another possible benefit, both from health and fiscal standpoints, is that if the higher taxes cause more people to quit smoking, tobacco-related illnesses should drop. The Centers for Disease Control and Prevention says cigarette smoking results in an estimated 443,000 premature deaths each year, and costs the economy $193 billion in health care expenses and lost time from work.
Let the IRS help you quit: If you really want to stop smoking, but just can't do it on your own, then Uncle Sam can help.
You can include as part of your itemized medical expenses the costs of a program to stop smoking. However, you cannot count the cost of stop-smoking drugs that don't require a prescription, such as nicotine gum or patches.
It's not a lot, and remember that it's part of the medical deduction on Schedule A that requires your total be more than 7.5 percent of your adjusted gross income before you can add it to your other itemized expenses.
But every little bit helps, when it comes to breaking a bad habit as well as cutting your tax bill.
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