Louisiana lawmakers voted against cigarette tax hike
Published on May 11, 2009 4:53 AM
The Louisiana State Legislature voted against the $1 increase in state cigarettes tax, despite numerous appeals from the tax hike supporters who unanimously stated that the increase would help generating millions of dollars to fund various health programs and contribute to further drop of smoking rates in the state.
However, the House Ways and Means Committee voted 11 to 7 against the introduced amendment.
According to the bill proponents, in case the bill had been approved, the state cigarette tax would have jumped from the current 36 cents a pack to $1.36, generating more than $200 million each year.
The spokesperson for Gov. Bobby Jindal declared that the governor would impose veto on the bill on any tax increase in case it has been passed by the Assembly.
However, that declaration did not stop Rep. Sharon Weston-Broome and Rep. Karen, from sponsoring the cigarette tax hike. Weston-Broome stated that she would keep applying all possible efforts to find ways to enhance health-care financing.
She claimed that in case the reasonable proposals would not arrive from the governor she would make them since this was her responsibility to help Louisiana residents standing in the need for good education and health care.
The bill was as well supported by various medical associations and anti-smoking activist groups and even the Louisiana Federation of Teachers.
At the same time, the proposal was heavily criticized by cigarette retailers and store owners, claiming that the increase would inevitably hurt the sales, especially when it would have come after just a month from the last price hike, which took place on April 1, when the increased federal cigarette tax came into force.
The House Ways and Means Committee chairman who voted against the tax hike cited the statistics showing that within the past six years, they have seen 57 cigarette tax hikes implemented by many states throughout the United States, however, in 40 of those cases state treasuries did not manage to collect the supposed revenue. On the contrary, several states have even lost almost a quarter from the revenue they had been generating before the tax hike.
Therefore, looking at the grievous example of those states it became evident that it has been almost impossible to estimate the amount of revenue that will be generated by the tax increase. Another thing that was also proven looking on the example of other states was the fact that smokers simply turned to other means of obtaining cigarettes instead of buying them for enormous prices.
The chairman concluded his speech by saying that the state has been facing a very difficult economic situation, and it would be a destructive decision to impose hefty taxes on cigarettes since smokers would cross the state line to stock for cigarettes elsewhere and the local retailers would be forced to get out of business, leaving many people jobless, that would be unacceptable nowadays. Thus the House Ways and Means Committee would endorse only sound and reasonable fiscal policy instead of imposing new taxes.
When the debate on the introduced bill began, Weston-Broome and Peterson asked the Committee to approve the proposal since the half of the revenue would be passed to under-funded health care system.
Preston said that the approval of the bill they have introduced for consideration would help to improve the situation with funding health care and as well as improve health of smokers and people who are still exposed to secondhand smoke.
Weston-Broome also cited the results of a survey performed by Louisiana State University researchers that demonstrated 75 percent of surveyed backed the tax increase.
New Orleans resident Karla Barker, a smoker of 30 years, admitted the results of the latter survey since were rather predictable since according to the statistics, 78 percent of Louisianans don’t smoke.
