Testimony before the Hawaii Senate Committee on Health and Human Services Regarding Increasing the State Excise Cigarette Tax

03-19-2025 Hawaii HB 441 Cigarette Tax Increase.pdf

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Chairwoman San Buenaventura, Vice-Chair Aquino, and Members of the Committee:

Thank you for your time today to discuss increasing that state excise tax rate on combustible cigarettes to fund various health care funds in the Aloha State. My name is Lindsey Stroud and I’m a Creator and Manager of Tobacco Harm Reduction 101 (thr101.org), a website dedicated to examining tobacco and vapor product use among adults and youth.

Policymakers should refrain from relying on revenue generated by state cigarette excise taxes, as cigarette tax revenue has declined due to declines in smoking rates. Moreover, such policies are regressive, as lower income and lower educated persons are more likely to smoke and will be disproportionately harmed by increased taxes. Rather than increasing the existing cigarette tax rate, policymakers should focus on policies that can reduce those costs associated with smoking, including robust funding for tobacco control policies, and embracing less harmful alternatives to smoking, which are associated with declines in cigarette use in Hawaii.

Key Points:

• In 2023, 102,737 Hawaii adults (9 percent) were currently smoking. This is a 27.4 percent decrease from 2022 and represents 38,905 fewer adults smoking.
  

• Among all adults earning $25,000 or less in 2023, 18.7 percent were currently smoking compared to 5.9 percent of adults earning $50,000 or more.
  

• Among all adults who had earned less than a high school education, 18.7 percent were currently smoking in 2023, compared to 5.9 percent of college graduates.
  

• Youth combustible cigarette use it at record lows with only 12.1 percent of high school students reporting having ever-tried a cigarette, and 3 percent reporting past-month use in 2023.
  

• Low-income and less-educated individuals smoke at significantly higher rates than their higher-income, more educated counterparts. Hawaiian adults earning $25,000 or less annually are three times more likely to smoke than those earning $50,000 or more.
  

• Between 2003 and 2023, smoking rates for adults earning $50,000 or more decreased by 53.4 percent, compared to only a 16.6 percent reduction among those earning $25,000 or less. Smoking rates among lower-income adults even saw a slight annual increase (0.4 percent) during this period, compared to a 3.3 percent annual reduction among higher-income earners.
  

• Adults in Hawaii without a high school diploma or G.E.D. are 3.9 times more likely to smoke than college graduates. Smoking rates among less-educated individuals decreased by only 25.5 percent between 2003 and 2023, compared to a 48.9 percent reduction among college graduates.
  

• In 2015, the poorest 20 percent of Americans spent 0.8 percent of their income on cigarette taxes, while the wealthiest 1 percent spent less than 0.1 percent.
  

• Cigarette tax revenue in Hawaii has significantly decreased over the past 20 years, with 2023 collections ($76.8 million) being 43.4 percent lower than the peak in 2011 ($135.6 million).
  

• While previous tax hikes (2006–2011) temporarily boosted revenue, the gains were not sustained, with collections declining annually since 2012.
  

• Hawaii collected more than $3.1 billion in tobacco-related revenue from 2003 to 2023 Only 5.4 percent ($168.6 million) was spent on tobacco control programs during this period.
  

• In 2023, Hawaii spent just $7.6 million on cessation and prevention, despite collecting $117.7 million in tobacco-related revenue.
  

• Tobacco harm reduction products including e-cigarettes, heated tobacco products, nicotine pouches, and snus can help adults quit smoking and reduce smoking-related health cares.