Return to Smokescam Report

Taxes paid by Smokers: State of Texas, 2002 Statistics
Texas Smokers' Contributions to the State Economy, 2003

Comparing number of six-packs of beer that must be sold in Texas to produce the same state excise tax revenue generated by one carton of cigarettes: 36.8

Comparing the number of bottles fo wine that must be sold in Texas to produce the same state excise tax revenue generated by one carton of cigarettes: 101.4

Texas Smokers' Contributions to the State Economy, 2003

In 2002, Texas smokers conprised 22.9 percent of the adult population in the state. Here is what they already pay because they choose to buy a legal product. (In 2005, the Texas Legislature added $1 to the taxes placed on a package of cigarettes. This additional tax is supposed to go toward public education in the state.)

Smokers Pay Excise Taxes(2): ....................................$...490,719,000
Smokers Pay State Taxes(2):.......................................$...251,268,000
Smokers Pay Tobacco Settlement Payments(3):...........$...494,918,000
Total........................................................................... $.1,236,905,000

(In words, that's one billion, 236 million, 900 hundred and five thousand dollars. Remember this will be a much higher amount when the additional Texas taxes on cigarettes go into effect and Texas smokers are paying for your child's education.)

Smokers' Economic/Tax Profile 2002

  • Income1
  • Texas smokers' median household income $ 29,913
    Texas nonsmokers' median household income $ 38,113
  • Working Families Pay More1
  • 41% of Texas smokers had household income LESS THAN $25,000

    12% of Texas smokers had household income EQUAL TO or GREATER THAN $75,000

    The impact of smoker payments on the incomes of working families was more than THREE TIMES the impact on higher income smokers. Those who can afford it least pay a disproportionate percentage of their hard-earned income in smoker payments.

    • Smoker excise tax/sales tax/tobacco settlement payments liability in 20024
    • Total average paid per Texas smoker in excise and sales taxes $ 216
      Cost per Texas smoker for settlement payments to Texas $ 144
      Total annual payments to Texas per smoker $ 360
      Total annual payments to Texas per nonsmoker $ 0

Texas Smoker Facts 5

Total smoker payments to Texas in FY2003 were:

  • More than twice as large as FY2003 state excise taxes on alcohol ($567.8 million).
  • Larger than FY2003 oil production taxes ($423.6 million).
  • More than six times as large as inheritance tax collections ($186.8 million) in FY2003.
  • Texas FY2003 smoker taxes would have covered funds budgeted for FY2003 for:
    • Public Community/Junior Colleges ($733.4 million) AND the Department of Health ($451.1 million - general revenue funds only) OR
    • Department of Mental Health and Retardation ($1.1 billion - general revenue funds only) OR
    • UT-Austin ($365 million) AND Texas A&M University ($279.9 million) OR
    • Parks and Wildlife Department ($250.2 million) AND the Commission on Environmental Quality ($374.8 million) AND the Department of Housing and Community Affairs ($204.6 million).

Sources:

  1. 1 Centers for Disease Control's Behavioral Risk Factor Surveillance System, 2002
    2 Orzechowski & Walker, Arlington, Virginia; from state revenue department.
    3 PriceWaterhouseCooper
    4 U.S. Census Bureau, 2000 state population and Centers for Disease Control's Behavioral Risk Surveillance System, 2002
    5 Tax and budget comparisons are from the Texas Legislative Budget Board, Fiscal Size-up, Texas State Services, 2002-03 Biennium, January 2002. Online at http://www.lbb.state.tx.us/Fiscal_Size-up/Fiscal_Size-up_2004-2005_1203.pdf.

Separately Settled Payments To Date:

$2,891,530,000 in calculated, estimated payments have been paid to Texas as part of a separate settlement agreement. The provisions of that settlement were similar to those in individual settlements previously reached with the four states (Florida, Minnesota, Mississippi and Texas) that did not participate in the Master Settlement Agreement.

For more about Taxes paid by Texas smokers and for the same breakdown on all 50 states, go to
http://www.smokersclubinc.com/modules.php?name=Encyclopedia&op=content&tid=56