Gov. Hochul’s proposed menthol ban, cigarette tax hike draws mixed reactions

ALBANY — Gov. Hochul’s proposed plan to ban the sale of menthol cigarettes and hit smokers with an additional dollar-per-pack tax is sparking a heated debate over revenue and the black market sales of cigs.

The governor, hoping to drive down tobacco use among younger New Yorkers and lower smoking levels in minority communities, included legislative changes banning flavored cigarettes and increasing taxes on cigarette purchases in her $227 billion budget proposal earlier this month.

Anti-smoking groups and health officials have applauded the proposal.

“The elimination of flavored tobacco products would safeguard our young people and those who have been addicted at alarmingly high rates as a result of the tobacco industry’s marketing efforts,” acting state Health Commissioner Dr. James McDonald said in a statement released on Thursday.

Meanwhile, convenience store owners and others say the ban on flavored tobacco products would be an unenforceable mandate that could leave a hole in state coffers and be a boon to the already thriving black market.

“Prohibition doesn’t work, period,” said Kent Sopris, the president of the New York Association of Convenience Stores. “What the governor is proposing is to move the sales of flavored tobacco products out of regulated retail spaces and send them into the underground market … or to other states.”

New York already leads the nation in the sales of illegal cigarettes. A report from the Tax Foundation, a D.C.-based think tank, found that around 53% of the cigarettes smoked in the Empire State in 2020 were purchased on the black market.

Sopris and others pointed to Massachusetts as an example of how bans fail to curb smoking and only lead to revenue losses for both businesses and state tax collection.

In 2020, the Bay State became the first state to prohibit sales of flavored tobacco products, including menthol.

Sales of cigarettes in New Hampshire increased by 22% and in Rhode Island by 18% in the 12 months following the implementation of the Massachusetts ban, according to the Tax Foundation.

“Smoking is a terrible health issue,” said Edgar Domenech, a former New York City Sheriff and deputy director of the Bureau of Arms, Tobacco, Firearms and Explosives. “But the reality is people do smoke … and they will find, through the black market or underground economy, a way to get cigarettes.”

A menthol ban in New York could not only drive up illegal sales but would also decrease state tax revenue by nearly $225 million per year, according to the Tax Foundation.

Hochul’s own budget proposal projects a ban could cost the state up to $133 million in tax revenue in the coming fiscal year starting April 1 and an additional $255 million 2025.

New York has already taken drastic steps to curtail youth smoking in recent years including raising the minimum legal age to purchase tobacco to 21.

In 2020, the state banned the sale of all flavored nicotine vaping products, including menthol.

Previous attempts to prohibit the sale of menthol cigarettes, however, have stalled at both the city and state level.

Backers of the ban include Hazel Dukes, president of the NAACP New York State Conference, who argues that big tobacco is targeting minorities with menthol smokes.

“I support this health measure because it will help reduce the health inequities facing African American communities throughout New York State,” Dukes said. “If we don’t act now, tobacco companies will stop at nothing to continue targeting communities of color—particularly Black youth—with these highly addictive, poisonous, and life-threatening products.”

Nicotine is highly addictive and smoking often leads to cancer and cardiovascular diseases, which are among the leading causes of death in the U.S., according to the Centers for Disease Control and Prevention.

State Health Department data shows that menthol cigarettes are used by over half of all adult smokers, while 86% of Black and 72% of Hispanic smokers exclusively smoke menthol.

Roughly 1.7 million New Yorkers smoke cigarettes and tobacco use among teens, which fell prior to recent surges due to vaping, is at the same level it was 20 years ago, state health officials said.

“With tobacco use the leading cause of preventable deaths, Governor Hochul is leading the way to a tobacco-free generation to reduce youth smoking and prevent senseless deaths,” Hochul spokeswoman Hazel Crampton-Hays said. “As with any budget proposal, we will work with the legislature on the final details for the best way to protect public health.”

The American Cancer Society Cancer Action Network also applauded Hochul’s proposal to increase the state’s per-pack tax for cigarettes from $4.35 to $5.35, making it the highest in the nation.

The group said the measures could result in thousands of lives being saved — but added that there’s more the governor could do to curb smoking in the Empire State, including increasing the budget for the New York State Tobacco Control Program and instituting a tax increase on all tobacco products.

“In addition to saving New York State hundreds of millions of dollars in smoking-related health care costs and generating millions in revenue that can be put toward evidence-based tobacco cessation programs, an increase to the cigarette tax will result in significant health benefits, including saving over 15,300 lives and reducing the number of adults who currently smoke by 44,800,” ACS CAN senior New York government relations director Michael Davoli said in a statement.

Sopris argues that the proposal to increase taxes on cigarette sales is a regressive tax that would hit minorities and working class New Yorkers hardest.

“The governor has framed her budget as a no-tax budget, except they have put one of the most regressive taxes in the budget,” Sopris said. “A cigarette tax increase is not going to hurt rich people, not going to hurt upper middle class, it’s going to hurt the people the budget professes to help.”

Critics of Hochul’s plan also say enforcement would be an issue as Hochul’s proposal doesn’t earmark any additional funds for law enforcement to crack down on illicit cigarette sellers.

Instead, the governor is proposing language allowing “state or local health officials” to impose a penalty of a minimum of $300 dollars or a maximum of $1,500 dollars if “not given access to a retail store and all product display and storage areas.”

The governor’s office notes that the proposal will not be a change to penal law and they don’t expect it to increase the workload of law enforcement.

Still, Domenech said sheriff’s deputies in the five boroughs are already overburdened as authorities work to rein in illegal cannabis shops.

“It’s already a dumpster fire and the menthol ban and the tax, you’re just adding fuel to the fire,” Domenech said. “None of these things have an enforcement component to it.

“It’s this perfect storm where the only ones who win are the bad guys,” he added.