Aspen City Council’s twisted logic on tobacco
August 22, 2017
The City Council wants to limit tobacco use in Aspen; it proposes a heavy tax. Critics argue a tax won't limit use much; it'll drive sales outside city limits (there are many nearby options).
Get this: City staff produced a "projection" indicating the tax (intended to reduce usage) won't reduce use much and will generate hundreds of thousands of dollars a year because people still will buy their cigarettes in Aspen for the prestige. One cannot make this stuff up.
Staff's rosy report predicts a $4-a-pack tax would increase city revenue $275,000 a year. Wow! Why not make it $10 a pack and clear a cool $600 grand annually? How could a tax proposed to reduce tobacco usage generate such huge revenue if it achieved its stated purpose of drastically reducing tobacco use? Only the sloppy research and fuzzy logic of government bureaucrats can produce this.
Staff uses price/demand elasticity numbers "from the internet" that homogenize observations across large areas (Cook County, Illinois, for example) to predict the decline in tobacco sales after a big new tax is imposed. But in those places tobacco users couldn't just drive a couple miles outside city limits to avoid the tax. Where was information from towns on the county line, where residents can walk across the street to another county and buy without the heavy tax? Left out of the analysis.
Staff predicts visitors will pay the tax because they're "affluent." I guess staff never heard that the "affluent" aren't just driving a couple of miles to avoid heavy tobacco taxes. They're moving their entire households from California and New York to Texas and Florida because they don't like being soaked just because they're "affluent." Affluent visitors stay at the St. Regis in Aspen because there isn't one at the Aspen Business Center or in Basalt. But visitors can bring their cigs with them (packed neatly in Louis Vuitton), or pick up cigs on the way to or from the Maroon Bells. And the bus is either free or dirt cheap.
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If council had any courage on this issue, they'd just ban tobacco sales in Aspen. They don't need voter approval for that.
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