By Timothy S. Donahue
Top Takeaways:
- Tax increase proposed: HB 2382 would raise Washington’s cigarette tax to $5.025 per pack.
- Revenue allocation defined: Funds would support emergency healthcare, tobacco enforcement, and the general fund.
- Debate mirrors past fights: Health groups back the hike, while retailers warn of cross-border and illicit market risks.
They changed their minds. Washington state lawmakers are now considering a significant cigarette tax hike, just weeks after the state raised taxes on other nicotine and tobacco products.
House Bill 2382 would raise Washington’s cigarette tax by $2 per pack, increasing the total tax from $3.025 to $5.025. Cigarettes were excluded from the state’s most recent nicotine tax increase, but supporters of the bill say the change is needed to help close a growing budget gap and offset healthcare costs associated with smoking-related disease.
“This bill is not trying to penalize anyone,” said Rep. Lisa Parshley, the bill’s sponsor. “It’s trying to help us make sure we can take care of all our communities in Washington, supporting our general fund and those impacted by these products.”
Under the proposal, the first $10 million in new annual revenue would go to the state Department of Health’s time-sensitive emergency system account, which supports care for trauma incidents, strokes, heart attacks, and similar emergencies. The next $2 million each year would be deposited into a nicotine and tobacco enforcement account to support compliance and enforcement efforts.
Remaining revenue would flow to the state general fund until July 1, 2028. After that date, 10% of revenue above the initial $12 million threshold would be allocated to the foundational public health services account.
The bill comes amid Washington’s multibillion-dollar budget shortfall, increasing pressure on lawmakers to identify new revenue sources.
During a House Finance Committee discussion, Rep. Joshua Penner questioned the logic of relying on cigarette taxes to fund the general fund.
“It just seems to me, kind of paradoxically, we are trying to keep the general fund alive through a tobacco tax,” Penner said.
Parshley responded that the revenue is intended to help offset healthcare costs incurred by public programs.
“We are seeing HR1 decreases,” she said, referring to federal healthcare funding pressures. “We are going to be backfilling through the general fund, so I see this as actually helping with our healthcare.”
Public testimony on HB 2382 reflected familiar divisions. The American Cancer Society Cancer Action Network supported the proposal, arguing that higher cigarette taxes remain among the most effective tools for reducing smoking.
“Tobacco taxes are the most effective tool to help people quit and to prevent people from becoming addicted,” said Audrey Miller Garcia of ACS CAN. She added that the proposed increase could save Washington an estimated $350.7 million in long-term healthcare costs, but only if the tax increase is large enough to change consumer behavior. “Otherwise, the industry can easily absorb these increases with coupons and discounts,” she said.
Retail and business groups pushed back, warning of unintended consequences for small stores. Molly Pfaffenroth of the Washington Food Industry Association said tobacco and vapor products remain key drivers of foot traffic in convenience stores.
“When taxes sharply increase, it does not actually stop people from buying the products they want,” Pfaffenroth said. “They just shift where they buy. Sales migrate to the unregulated market and across state borders.”
HB 2382 is not currently scheduled for a hearing in the House Finance Committee, but lawmakers have indicated it could be folded into Washington’s supplemental budget negotiations as the March 12 deadline nears.
