Chicago’s new cigarette tax will lead to more black-market sales and violence, alderman say

South and West Side aldermen believe that an increase in the tobacco tax will lead to an increase in black-market sales and violence. They're right.

Despite opposition by aldermen from the city’s South and West Sides who have made the case that Mayor Rahm Emanuel’s tobacco-tax hike will lead to more black-market sales and violence, the Committee on Finance held a recessed meeting on Feb. 10, just minutes before the full City Council meeting, and passed the mayor’s plan by a roll-call vote of 22-9. Alderman Leslie Hairston, 5th Ward, and Alderman Brendan Reilly, 42nd Ward, made a motion to defer and publish the ordinance, effectively delaying a full City Council vote until March.

The average cost of a pack of cigarettes purchased in the city of Chicago is $12, $7.17 of which is taxes. The mayor’s plan would set a minimum price on a pack of cigarettes at $11.50, add a 15-cent tax per “little cigar,” impose a 90-cent tax on larger cigars, add a tax of $1.80 per ounce on smokeless tobacco, and a $6.60-per-ounce tax on roll-your-own tobacco. The new tax would fund a new summer orientation program for Chicago Public Schools freshmen, smoking cessation programs, and a remedial program for at-risk eighth graders.

Tobacco use has steadily declined since the 1960s, and this makes tobacco taxes an uncertain revenue source. South Side Alderman Patrick D. Thompson, 11th Ward, was surely aware of this when, during a Feb. 8 Finance Committee hearing on the mayor’s proposed tobacco-tax hike, Thompson asked the city health commissioner how the new programs could continue when the annual revenue isn’t guaranteed. City Health Commissioner Julie Morita didn’t have an answer.

Chicago cannot continue to raise its already highest-in-the-nation tobacco tax and expect to avoid collateral damage. The sale of loose cigarettes, commonly referred to as “loosies,” has affected South and West side neighborhoods for years. During the debate at the Feb. 8 hearing, Alderman Roderick Sawyer, 6th Ward, said he knows one man who makes $800 a day selling loosies.

To address the concerns about the black market in loosies, the compromise plan approved by the Finance Committee on Feb. 10 would raise the fines associated with selling these cigarettes.

Morita pointed to studies to support the city’s claims that raising the taxes would prevent children from buying and getting hooked on tobacco products and dismissed aldermen’s concerns as “anecdotal.” But West Side Alderman Jason Ervin, 28th Ward, shared daily experiences, according to the Chicago Tribune. Ervin told the commissioner and City Council, “I implore you to walk down Madison (Street) with me, … and you will see the real consequences of what we’re talking about. This is not theoretical. This is not something that I dreamed up.” Ervin has been fighting cigarette-tax increases and has even called for reducing cigarette taxes to bring Chicago in line with Indiana because he has witnessed turf wars over loosies.

Nationally, an increase in the tobacco tax has led to direct and indirect violence. In 2008, an elderly couple was killed in a car crash as a suspected cigarette smuggler fled police. In 2010, a Virginia man admitted guilt in a murder-for-hire plot involving smuggled cigarettes. In 2014, Eric Garner was killed by New York City police as they detained him for allegedly selling untaxed cigarettes. His death was a tragic, unintended consequence of the exorbitant tobacco taxes in New York City.

Raising the tobacco tax has brought myriad unintended consequences, typically in poorer communities already plagued by high crime. The city cannot fund programs to help at-risk youth at the expense of added neighborhood black markets and violence. To do so would be counterproductive and unconscionable.

Fines haven’t worked in the past at curbing violence and the sale of illegal cigarettes. Why should that start now?