Lawmakers agree on cig. tax increase
A long-awaited tax hike on cigarettes could be signed into lawby Gov. Haley Barbour as early as next week after the Legislatureoverwhelmingly approved a 50-cent per pack increase Wednesday.
But not all lawmakers, though, are happy with the decision.
District 92 Rep. Becky Currie, R-Brookhaven, was the only one offour local legislators to vote against House Bill 364, which wouldmake the state’s total tax per pack of cigarettes 68 cents and isexpected to generate approximately $100 million during its firstfull year of implementation.
Currie pledged to support the increase earlier in the year ifsome of the revenue were earmarked for Medicaid, which is stillfacing a $90 million shortfall from last year that is expected toworsen in the future. Since HB 364 did not directly supportMedicaid, Currie cast her lot with approximately 20 otherrepresentatives who voted against the increase.
“When this money was not going into that, and just going intothe general fund to make government bigger, I just could not votefor that,” she said. “If we were going to put the money intoMedicaid and pay for cigarette-related illnesses, I couldunderstand that concept.”
Currie is opposed to using cigarette tax revenue to pay for thecar tag credit program, a $30 million shortfall she said could besolved easily enough without a new tax. Though HB 364 does notearmark any funds for the program, many lawmakers support using theincoming revenues to pay for it.
“To tax some people, in order to lower the tax of other people,I just could not do it,” Currie said. “I’m going to tax a smoker socar tags are lower for somebody else? That’s not a good enoughreason. Instead of tightening the belt and getting control ofgovernment spending, we’re going to raise taxes on cigarettes – wehave no accountability for taxpayers’ money. Zero.”
Other local lawmakers were pleased to see the cigarette taxincreased passed on to the governor’s desk.
District 53 Rep. Bobby Moak, D-Bogue Chitto, was one of sixHouse and Senate conferees who negotiated the 50-cent increase, andhe approved his work by voting “yea” Wednesday.
Still, Moak warned the new tax is not a cure-all forMississippi’s budget woes. Even if a full $100 million has beencollected from the tax by next May, that amount will not come closeto plugging budget holes that Barbour has predicted to reach ashigh as $800 million by 2011.
“Your revenue will commence May 15, and between then and July 1,probably $15-$20 million is my best guess,” Moak said. “But it willnot cure budget woes.”
Moak dismissed criticism that HB 364 did not earmark funds forMedicaid, pointing out the program will get support from federalstimulus funds. The legislative fight for a hospital assessment isstill ongoing as well, he said.
“The fact is we only have one tax earmark, and that’s 1 cent foreducation,” Moak said. “Everything else is not earmarked – theLegislature simply appropriates those funds. It puts everyone on aneven keel – different state agencies get out there and fight fortheir budgets, and it allows those voices to be heard every year.If you have earmarks, those voices don’t get heard.”
District 91 Rep. Bob Evans, D-Monticello, voted in favor of HB364, but he wanted much more from the bill. Evans wanted the billto tax smokeless tobacco as well as cigarettes, wanted the taxincrease to be $1 and revenues earmarked for Medicaid.
But he still supported the bill, hoping it would lead to areduction in the amount of smokers in the state and serve as abarrier to underage smoking.
“I wish it had been earmarked for Medicaid, but I can live withit this way,” Evans said. “It’s like the old Chinese saying – awalk of 1,000 miles starts with the first step. This, to me, isjust a step in the right direction.”
Evans may eventually get what he wants. He said discussions onthe House floor during Wednesday’s debate signaled a possiblefuture return to the cigarette tax to add other tobacco products tothe list.
“As far as I’m concerned, if you’re going to increase the tax ontobacco, it ought to be exactly that, instead of jut a cigarettetax increase,” Evans said. “Maybe we’ll start working on alcoholnext.”