The entire tobacco tax revenue in 2022 was only $11 billion. At the margin, the proposed reduction in smoking would only reduce revenues by ~$400 million while saving $2.6 billion. That's clearly profitable.

30 million people smoke

$1.50 per pack tax (1.01 fed, giving high estimate for state taxes)

2 packs a day (high)

(30,000,000 x 1%) x (1.5 x 2) x (2 x 365) = 657,000,000

You'd need 4% to quit to even out.

To add onto this (given the actual numbers of ~11 billion collected) you’d actually need 23.63% to quit to lose the same revenue as you’d save with just 1% quitting.

Of course if you had nearly a quarter quit you’d save even more, so…

#TheyDidTheMath

You’d lose that bet.

State and local governments collected $19 billion in revenue from tobacco taxes in 2020. Which was high. In 2022 it had dropped to a more normal level of $11.26 billion.

1% of that is $11 million.

Quite a difference.

1% of 11 billion is $110 million.

To go from a million to a billion, you multiply by 1000.

Same to go from 1 to one thousand or one thousand to one million. It’s also easy to remember since the commas are every 3 decimal places.

1/1000 is equivalent to 0.1%, not 1%.

Indeed, a typo, my apologies.

The point that it is a LOT less than 2 billion stands however

Your math is bad. 1% of recipients is nowhere near the same as the 1% of smokers you used.

It’s assuming the 1% of smokers who are recipients are evenly distributed (statistically speaking) across the smoking population. A quite reasonable assumption.

Therefore, to generally reduce the population of recipients you’d have to reduce the population of smokers.

Unless you have data showing a specific population skew or sampling issue I’d say it is perfectly good math, albeit with an assumption.

Now, of course, you could simply deny service to 1% of smokers who would be recipients—or other extremely skewed sampling attacks—but that is somewhat unlikely and in most cases directly against the goals of the program.

How about how much tax money will be gained from having alive and healthy people earning money and paying taxes? I bet it's going to be more than whatever cigarette tax will be lost...

Not if the smoking cohort is concentrated in older, retired members of the population.

It's not. Smoking among those over 65 has always been relatively rare. It used to be that the highest rates were among those under 30 but those younger adults today don't want tobacco and the current largest cohort of smokers is middle-aged. Less than 10% of over-65 Americans smoke tobacco according to various surveys.

Look around you, do you see only old sick people smoking? Also at this study (for Spain):

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6813084/

> Deaths due to lung cancer represented the 28.90% and the 10.83% of all cancer-related deaths in 2017 in males and females respectively, with an increasing tendency in this last group. In addition, the YPPLL count increased in the study period among females. Lung cancer was responsible annually for 60,846 YPPLL, and productivity losses summed €13.1 billion over the 10 year period.

In New Zealand we tax tobacco heavily. It is thought that smokers save the government money - they pay a lot of tax and die early.

https://www.nzherald.co.nz/nz/smokers-save-govt-cash-says-re...

This is true for my country as well. Govt taxes cigarettes around 1000%. I'm not kidding, that's a thousand percent tax. Our govt essentially runs on smokers and drinkers tax money.