R 



iscal contributors 



Even-one buying a package of cigarettes in Kentucky, 

 as elsewhere in the United States, pays a federal tax of 

 8 cents. Additionally, a state excise of 3 cents is applied 

 to each package and there is a 5 percent sales tax. The 

 total yield from these various tax sources represents a 

 substantial contribution to federal and state treasuries. 



Voices have been raised in protest against the multi- 

 plicity of taxes. A practical Kentucky farmer, Virgil 

 Steed, author of a book published in 1947, is among the 

 commentators on the subject. He remarked: "The prof- 

 iteering middleman (in tobacco commerce) is govern- 

 ment — municipal, state and Federal . . . tobacco has 

 carried more than its fair share of the tax burden." 



The original tax on cigarettes in Kentucky, 1 cent on 

 each 20, became effective in 1936. Increased to 3 cents 

 in 1954, it was reduced to the 2^2 rate in 1960 and 

 increased again to 3 cents in 1970. Revenue from the 

 additional half-cent increase is currently bein^ used by 

 the University of Kentucky as part of a world-wide 

 attempt to do further scientific research on many aspects 

 of smoking and health. 



Since the inception of the tax the gross yield to June 

 30, 1971 has been over $247 million. Income from this 

 source goes into the state general fund. Its benefits to all 

 Kentuckians — smokers or not — are visible through the 

 construction and maintenance of schools, hospitals, 

 roads, bridges, and in community services. 



Kentucky's predominant agriculture and the com- 

 mercial operations that meet consumer demands for 

 tobacco products have an impact on every division of 

 the state's economy and on a good part of its social life. 

 The current commerce has its roots in times long past. 

 The theme of tobacco is intimately woven into the his- 

 tory of the Bluegrass State and the theme is not only 

 an interesting one; some of it is unusually dramatic. 



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