Don’t snuff out cigarette tax hike

Gov. Gary Herbert is mistaken when he equates proposals to drastically increase the state’s cigarette tax with the kind of tax increase that would harm a struggling economy. Reasons to raise the cigarette tax are many, varied and compelling. Yes, it would raise revenue — estimates run between $24 million and $70 million, depending on the size of the increase and projections on how many people would quit the habit — but the health benefits are even more important.

Last week, Herbert said, “I’ve got a couple of pens already out there, greased up and ready” to be used to veto bills the Legislature might send him. Among the ideas he suggested he would veto is a tobacco tax hike.

The governor has been vague about his reasons for rejecting such an increase, other than to say this isn’t the time to raise taxes. And yet Utah’s current cigarette tax of 69.5 cents per pack is an embarrassment. True, it is in line with what neighboring states have levied. Wyoming’s tax, for example, is 60 cents. But Utah, a state that values health and clean living, should do better than that.

The national average is close to $1.40 per pack, but New York charges $2.75, and Rhode Island levies $3.46. High tobacco taxes are more than just ways to drain revenue from people addicted to a bad habit. They are tools of prevention, and they can help the state pay for the medical impacts of tobacco.

Credible research shows a strong connection between increased cigarette costs and a reduction in youths taking up the habit. According to the Campaign for Tobacco-Free Kids, even a 10 percent increase in the price of cigarettes cuts youth smoking by about 7 percent and overall cigarette consumption by about 4 percent. Utah already has a relatively low smoking rate. Why not cut it further? Why not give impressionable young people an economic disincentive to take up the habit?

Smoking also leads to a host of health care costs. The United Way of Salt Lake and the American Cancer Society have said smokers on Medicaid rack up $104 million in bills annually. Put in those terms, the true cost per pack of cigarettes sold amounts to $7.75, and yet Utah collects only 69.5 cents.

This isn’t much of a budget-balancing strategy, but it is a sound public health strategy.

We understand and agree with Herbert’s insistence that the state hold the line on taxes. However, his own proposal to remove the 1.31 percent sales tax discount given to larger businesses would damage the economy more than a cigarette tax hike. The discount offsets the money those businesses must spend to collect sales taxes. Removing it would yank $20 million from the bottom lines of those businesses. Opponents of a cigarette tax say it would hurt convenience stores, but it’s hard to take seriously the argument that smokers would drive to Wyoming to feed their habits.

A cigarette tax hike would accomplish many purposes. Now is the time to do it.

source: deseretnews.com

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