Between the years 2004 and 2012 the smoking prevalence in Virginia declined by 3.43%. Over the same period, significant increases in federal, state, and local cigarette taxes occurred. This study first examines the extent to which smoking prevalence impacts smoking related hospitalizations in Virginia in 2004 and then provides analysis on the efficacy of local cigarette taxes in reducing smoking prevalence between the years 2004 and 2012. County-level econometric analyses determined that a one percentage point increase in total smoking prevalence is associated with a 0.0453% increase in COPD hospitalizations and about 27 more asthma hospitalizations per 100,000 persons. While multivariate regression analysis suggested increases in local cigarette taxes are associated with a decline in the total smoking prevalence, more rigorous first difference models suggested increases in local cigarette taxes are associated with an increase in total smoking prevalence. It remains unclear whether local cigarette taxes cause total smoking prevalence to increase. Further study should be done to assess whether increases in local cigarette taxes are conducive to the health of Virginians.