Posted on 02/26/2005 2:46:19 AM PST by SheLion
MIAMI, Feb 25 (Reuters) - Southern tobacco-producing U.S. states, backed into a corner by financial woes, are breaking a taboo against raising their minuscule taxes on cigarettes.
North Carolina, Kentucky and other southern states with some of America's lowest excise rates on cigarettes are defying a powerful tobacco lobby and debating hefty tax increases meant to add hundreds of millions of dollars of much-needed revenue.
"States are just coming out of their worst times in years and years, and this has been a very popular strategy for raising revenue," said Sujit CanagaRetna, a senior fiscal analyst in Atlanta with the Council of State Governments. "Strongholds of tobacco are now considering raising taxes."
Some southern U.S. excise taxes have held steady for decades, even as other state governments across America have raised the taxes amid sluggish economic growth.
State excise taxes, which are on top of federal government levies of about 40 cents a pack, range from $2.46 in Rhode Island to 3 cents in Kentucky and help pay for schools, roads, healthcare and other civil services in each state.
The estimated average state excise tax this year was 84 cents, or double 2000's average, according to a Merrill Lynch study. Cigarette taxes also have been on the rise outside the United States, particularly in Western Europe.
North Carolina Gov. Mike Easley, a Democrat, on Wednesday urged a tax hike of 45 cents over two years as he sought to close a $1 billion gap between revenue and spending. Such a rise would add $454 million in revenue over two fiscal years.
Cigarette companies with big operations in North Carolina said the industry already pays hundreds of millions of dollars a year to North Carolina under a 1998 legal settlement and that higher taxes would hit jobs and mainly lower income people.
"While North Carolina's excise tax is only 5 cents, the total taxes given to North Carolina by smokers adds up to more than 61 cents per pack," said Vice President Steve Watson of Lorillard Tobacco Co, a unit of Loews Corp (LTR.N: Quote, Profile, Research) .
Kentucky's Republican governor, Ernie Fletcher, is championing an overhaul of the state's tax code with a centerpiece hike in the state's 3-cents-a-pack tax.
Last week, the Kentucky House of Representatives overwhelmingly passed the tax bill with a rate of 29 cents, instead of the 34 cents recommended by Fletcher. The state Senate is now considering the tax bill.
"A reasonable increase in the cigarette tax will ensure that smokers help pay for the higher health insurance and Medicaid costs that Kentucky faces because it has the highest incidence of adult and youth smoking in the country," Fletcher, a physician, said in an essay in the Lexington Herald-Leader newspaper.
Wrestling with a $268 million deficit in Medicaid, a federal-state healthcare program for poor and disabled people, Mississippi legislators are weighing a bill to raise the state's 18-cents-a-pack excise tax to 50 cents. That would raise an estimated $120 million a year.
In 2004, the same year Virginia raised its tax to 20 cents from a 2.5 cents rate fixed in 1967, the political landscape in the south shifted when the federal government agreed to pay $10 billion over a decade to end subsidies to tobacco farmers.
"The federal tobacco buyout makes it easier for legislators worried about folks in rural districts to go along. The buyout makes it more palatable in places like North Carolina and Kentucky," said CanagaRetna.
"Even the most Republican legislator feels this is not as radioactive as other taxes."
You non-smokers must feel very good indeed. Yet most non-smokers don't want nothing to do with us! You make us stand outside to have a cigarette and most of you are SO for no smoking in private establishments. And yet, we smoker's are carrying the load for you.
It has to stop. Either ban tobacco entirely or start accepting us again. Better still........THANK us for saving YOU from being hit with the TAX man!
A nasty play on words. They make it sound like the cigarette companies are paying the billions a year through the Tobacco Settlement Money. The truth is, folks, it's the SMOKERS who pay TAXES on CIGARETTES that are paying into this money. NOT Big Tobacco and NOT the Government! But the SMOKERS!!!!!
What North Carolina is already paying into the state coffers:
North Carolina Information
Kentucky Information
Tobacco Taxes
Kentucky's excise tax per pack of cigarettes: $0.030
Kentucky's excise tax collection for the
fiscal year ending June 2002: $17,145,000
Sales tax on tobacco products: 6.00%
Federal excise tax per pack of cigarettes: $0.39
Total federal excise tax collections in fiscal year 2002: $7,512,700,000
Click here for the Cigarette Tax and Payment Table for all states.
“minuscule taxes on cigarettes”?
IF the smoker's tax dollars ARE spent on health programs for the poor and disabled and Medicaid, that is all well and fair. But when the lawmakers spend this money on big expensive golf courses and their pet programs, this is WRONG.
The Tobacco Settlement was supposed to be spent on health care and for cessation programs for those who want to quit smoking and to help sick smokers should there be any. Anything other then it is just wrong. For instance:: bans, control, restrictions. Smokers are paying for their own abuse. I wish the general public would wake up!
Using the tax money smoker's pay on cigarettes to balance state budgets is JUST WRONG.
Been there done that and it's a complete nightmare. I soon learned to stock up on CD-R's and I burn everything that I think needs saving!
The gist of the ruling was that taxation could not be used to mold public morality.
And what about President Reagan's statement:
The taxing power...must not be used to regulate the economy or bring about social change."
Ronald Reagan - 1981
When I park at a store or restaurant and get out of my car, the parking lot is almost always littered with several butts. Hardly ever any gum wrappers or anything like that. Just tons of cigarette butts.
While watching a spring training baseball game in Arizona one year, a fan sitting next to me accidentally bumped her cigarette onto my shoulder, leaving a little black burn mark on my shirt. ("Oops, sorry about that," she explained.) As if blowing second-hand smoke into our faces isn't enough, now you've got to try setting us on fire, too?
Too many smokers are rude, obnoxious litterbugs who deserve any higher taxes that come their way.
Sometimes i duck when i'm driving, Reflex from seeing a red bright cigg exploding on my windshield from the car in front at night. Sometimes i pull over and see if one is stuck to my car if i don't see it in the rear view mirror. Luckily non have entered my car yet ((Knock on wood))
The litter taxation post is two pages back.
By the way, your Dad called and said your allowance would be cut until you cleaned up your room.
Once the tobacco state pols see that they can raise cigarette taxes with only minor political fallout, a free-for-all can be expected as governors and legislators seek to dethrone Rhode Island as the max-packs-tax leader!
The taxing power...must not be used to regulate the economy or bring about social change." Ronald Reagan - 1981
My stack of backup CDs is now rivaling my stack of music CDs – and I think the music CDs breed when no one’s looking - but my CD burner just died.
I've said it before and I'll say it again: This "cigarette hitting my windshield" thing has never EVER happened to me, and I drive on some of the busiest roads in the US (NYC/Long Island).
I've been driving on these roads for...well, for my entire life. My car has been hit by many an object -- mostly tiny pebbles kicked up by trucks ahead of me. In fact, I've had to replace no less than three windshields because of it.
But a cigarette? Never been hit by one, and I've never heard of anyone having to replace a windshield because of one, either.
Where do you guys live that this happens to you on a regular basis?
Regards,
PS: The southern states are foolish. NYers by the carload are already driving down to them every week to stock up on cigs, and now that the idiot politicians here in NY are going after the people who buy on the web, that number will only increase. They will be killing the goose that laid the golden egg.
I find that rude, obnoxious folks I run into tend to have voted for Kerry/Edwards, for some odd reason.
Because the power to do so goes to their heads !
I'm very sorry about that. Those smoker's give the rest of us a bad name. I never ever 'flick' a cigarette out of the window, and if I go to an outside event where there are no ashtrays, I carry a Coke can with a little water in which to place my 'butts.' There is no excuse for litter not matter what it is.
When I park at a store or restaurant and get out of my car, the parking lot is almost always littered with several butts. Hardly ever any gum wrappers or anything like that. Just tons of cigarette butts.
Again, I am sorry about that. But that is not of my doing. I think a lot of smoker's today are just so sick and tired of being treated like third world people that they do this to make a statement. Also, one big mistake the stores made was getting bid of their "butt cans" outside that smoker's could extinguish their cigarettes. Now, there IS no place to put the butts except on the ground!
While watching a spring training baseball game in Arizona one year, a fan sitting next to me accidentally bumped her cigarette onto my shoulder, leaving a little black burn mark on my shirt. ("Oops, sorry about that," she explained.) As if blowing second-hand smoke into our faces isn't enough, now you've got to try setting us on fire, too?
I realize sitting in the stands makes for very close seating. I always feel like a sardine. Blowing smoke in your face? Well, if you feel that smoker's are blowing smoke in your face in a grand stand, perhaps it's the wind not being very cooperative. And if that is the case, try moving to another seating area. Easy as that!
Too many smokers are rude, obnoxious litterbugs who deserve any higher taxes that come their way.
I'm sorry you feel that way. If all the smoker's quit or disappeared....guess what? They will come after something YOU love. And if that happens, please don't come crying to us.
If you are driving that close to the car in front of you to worry about a "butt" hitting your car, maybe you better put a car's length between you and the car in front, like the DMV suggests!
I know what you mean! I am really getting a bunch of back-up's here. But I must say: the CD-R's are so much better then the old floppies!
Yep! The so-called Conservatives that post on the smoking threads are more obnoxious then the smokers, I find.
And you are probably right. These "Conservatives" voted for FnKerry!
SheLion wrote:
If you are driving that close to the car in front of you to worry about a "butt" hitting your car, maybe you better put a car's length between you and the car in front, like the DMV suggests!
--> LOL, I do leave space, and more. You'd be surprised what a little Windspeed/velocity/ can do and the Cigs just Fly, people don't realize how hot and bright that cherry is as it catches air and Smacks into the car. I would assume your a smoker, like you assume that i tailgate?
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