New FTC Report: Tobacco Companies Spent Massive $425 Million on Marketing in Indiana
Posted on: Friday, 27 April 2007, 00:00 CDT
WASHINGTON, April 26 /PRNewswire-USNewswire/ -- Tobacco companies spent a massive $425 million on marketing in Indiana in 2005, with much of it spent on price discounts that make cigarettes more affordable to kids, a new report released today by the Federal Trade Commission (FTC) indicates. The tobacco companies spend nearly $40 to market their deadly and addictive products in Indiana for every $1 the state currently spends on tobacco prevention programs.
Health advocates say the new report shows why it is critical that the Indiana Legislature increase the state's cigarette tax by at least $1 per pack and use the revenue to restore past cuts to the state's nationally recognized tobacco prevention programs run by the Indiana Tobacco Prevention and Cessation Agency (ITPC). A legislative conference committee is currently meeting on the issue.
"The staggering amounts tobacco companies spend to market their deadly and addictive products in Indiana serves as a timely reminder about why Indiana leaders must seize the opportunity before them to protect Hoosier kids from tobacco," said William V. Corr, Executive Director of the Campaign for Tobacco-Free Kids. "The best thing that Indiana leaders can do to protect kids from this onslaught of tobacco marketing is to significantly increase the cigarette tax and restore funding for the Indiana Tobacco Prevention and Cessation Agency. Anybody who opposes spending more money on tobacco prevention is doing Big Tobacco's dirty work, whether intentionally or not."
The new FTC report shows that the tobacco companies have nearly doubled their marketing expenditures nationwide since the 1998 state tobacco settlement, which was supposed to curtail tobacco marketing. In 2005, the latest year in the reports, the tobacco companies spent $13.4 billion on marketing nationwide -- $36.6 million a day. In 1998, the tobacco companies spent $6.9 billion on marketing.
The Campaign for Tobacco-Free Kids calculated the amount of cigarette marketing in each state based on the FTC's national marketing total and the percentage of cigarette packs sold in each state. That analysis determined that the cigarette companies spent about $425 million on marketing in Indiana in 2005. In comparison, Indiana is spending just $10.8 million this year on programs to prevent kids from smoking and help smokers quit.
The bulk of the tobacco company marketing dollars are spent on price discounts that make cigarettes more affordable to children, the most price-sensitive customers. The Campaign for Tobacco-Free Kids said states should counter this discounting by significantly increasing tobacco taxes and funding for tobacco prevention programs.
The evidence is clear that increasing Indiana's low cigarette tax and using the revenue to fund tobacco prevention programs will significantly reduce smoking, especially among kids. A $1 per pack cigarette tax increase would prevent nearly 90,000 Indiana kids alive today from becoming smokers, save more than 14,000 current Hoosier smokers from tobacco-caused deaths,
produce $2.7 billion in long-term health care savings, and raise $352.3 million in new revenue each year. The benefits will be even greater, and continue to increase over the long-term, if the new revenue is used to fund tobacco prevention and cessation programs.
Tobacco use is the leading preventable cause of death in Indiana, claiming more than 9,800 lives each year and costing the state $2.1 billion annually in health care bills, including $487 million in Medicaid payments alone. Government expenditures related to tobacco amount to a hidden tax of $585 each year on every Indiana household. While Indiana has made significant progress in reducing youth smoking, 21.3 percent of Indiana high school students are still current smokers, and 10,200 more kids become regular smokers every year.
The FTC reports can be found at: http://www.ftc.gov/opa/2007/04/cigaretterpt.shtm.
Campaign for Tobacco-Free Kids
CONTACT: Jennifer Friedman of the Campaign for Tobacco-Free Kids,+1-202-296-5469
Source: PRNewswire-USNewswire
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