2010/11/24 P-D OpEd:”Cigarette Taxes – Missouri can’t afford to be last”

Yesterday’s St. Louis Post-Dispatch had a well-argued OpEd from Rep. Mary Wynne Still (D), Columbia, in favor of legislation to raise Missouri’s cigarette excise tax from its current low of 17 cents a pack, but one very unlikely to make any headway in the legislature. It isn’t merely because of Republican control: it was the same when the Democrats were in charge when the chairs of critical committees were smokers themselves.

The last time the cigarette tax was raised in Missouri was in 1993 as a result of a political deal between former Missouri House Speaker Bob Griffin, a Democrat, and the tobacco lobby. As part of that deal the Speaker agreed to oppose any future tax increases.

A good review of the whole sordid story of how the tobacco industry has successfully opposed good public policy at the state level in Missouri appears in a well-researched study by Michael S. Givel, PhD, and Stanton A. Glantz, PhD, titled:

The Public Health Undermined: The Tobacco
Industry’s Legacy in Missouri in the 1990’s

The study was published in November 2000 and is now available on-line by clicking the above link. Below are relevant excerpts from the study pertaining to the tobacco excise tax issue:

From 1990 to 1992, Missouri’s tobacco excise tax on packs of cigarettes was 13 cents per pack. There was an effort in the 1991 Missouri Legislative Session to raise this tax rate, which was vigorously opposed by John Britton [at the time, tobacco lobbyist for the now-disbanded Tobacco Institute] and the rest of the tobacco lobby. ……

By December 1992, this situation was about to change when Missouri House Speaker Bob Griffin (1991-1992 tobacco industry contributions $2,450) announced that he was contemplating a cigarette tax increase to fund a health care bill, which would increase preventive health care in clinics and schools and provide affordable health insurance to employers with 50 or fewer employees. In reaction to this, by April 1993, John Britton and the tobacco lobby had made a deal with House Speaker Bob Griffin to accept a four-cent increase in cigarette taxes. In return, according to an internal Tobacco Institute document, the industry received the following:

    Attached is a copy of the amendment we plan to offer the committee [Senate Public Health and Welfare Committee] that will cap local taxes in Missouri. According to John Britton, we have the votes to get the amendment adopted in Committee.
    As you know, both Britton and Roger Mozingo [Vice-President State Government Relations, R.J. Reynolds Tobacco Company] have spoken to the Speaker about this issue. The Speaker has told them both that he will support our amendment. The Speaker also points out that he feels locals do not have the power to tax cigarettes under Missouri’s constitution.
    I want to make sure that you are aware that we will not oppose HB [House Bill] 564 if our amendment is adopted and stays in the bill.
    Also, you need to be aware of the possibility of a rash of attempted local tax increases prior to October 1, 1993, which is the effective date of the bill. We have looked at Missouri’s law very carefully and can find no way to close this four and one half month window. An emergency clause on the cap section is the only possibility.
    Britton has told me it would be impossible to get a two-thirds vote for an emergency clause given the controversial nature of the topic.

The legislation was subsequently adopted by the Missouri legislature with the preemption clause banning local adoption of new cigarette taxes remaining intact. Democratic Governor Mel Carnahan signed the bill into law on July 1, 1993.

Despite the party political upheavals in Jefferson City, the fundamental situation hasn’t changed much as regards tobacco control and the issue of cigarette taxation, so despite Rep. Mary Wynne Still’s arguments in her OpEd below, I don’t expect any progress on this issue.

Cigarette Taxes – Missouri can’t afford to be last
It’s time for smokers to pay their fair share.

By Mary Wynne Still | (3) Comments | Posted: Tuesday, November 23, 2010 12:00 am

In many categories, Missouri has the lowest taxes in the country. The 2010 Morton Quitno State Rankings Book lists Missouri as:
    • 47th lowest in per-capita taxes;
    • 46th lowest in corporate income tax;
    • 40th lowest in general revenue sales tax.
    Now Missouri has a record low. As of July 1, when South Carolina raised its cigarette tax to 55 cents a pack, Missouri became the state with the lowest cigarette tax in the nation. Missouri’s 17-cents-a-pack tax on cigarettes is now well below all the tobacco-producing states and all surrounding states. In fact, Missouri could raise its tax by 12 cents a package and still be the lowest — with tobacco-producing Virginia still above Missouri at 30 cents.
    In other words, Missouri could double its cigarette tax and be the second lowest. Right now, when adjusted for inflation, Missouri’s cigarette tax is actually lower today than it was in 1961.
    If this is a race to the bottom, we win.
    But, what is the prize?
    • More smokers. Already we rank fourth in the country in the percent of adults who smoke.
    • More citizens suffering from lung cancer. We rank fifth in the nation in the number of new lung cancer cases, and we have the seventh-highest lung cancer death rate.
    • More pregnant women smoking. Already, 31 percent of women in Missouri who are apregnant and on Medicaid smoke. This results in lower-birth weight babies at significant costs and with terrible illnesses.
    But, forget for a moment the tragedy of these deaths and illnesses. And forget that our state is in the deepest budget hole since the Great Depression, which requires all of us to tighten our belts.
    Let’s look at this simply from a position of fairness. Citizens who smoke are costing our state a bundle. Missouri now pays $738 per pregnant woman to treat tobacco-related problems. The Missouri Budget Project estimates that smoking-related illness cost the state’s Medicaid system $641 million in 2009 of combined federal and state funds, of which $256 million was state general revenue.
    It is time to ask citizens who smoke to do their part in helping us cover their expenses.
    A 12-cent increase in cigarette taxes — that’s less than a penny a cigarette — would raise about $68 million. Our Constitution restricts the amount of new taxes the legislature can impose any given year without a vote of the people. Because a 12-cent increase produces a revenue increase well below the ceiling mandated by the constitution, this amount could be imposed directly by the Legislature.
    An alternative would be to send this issue directly to the voters. Let the voters decide if they would support a greater increase. A $1-a-pack increase would net $570 million revenue gain, but keep Missouri well below the national cigarette tax average and in line with its border states.
    Either proposal moves Missouri ahead — both on health and well-being of our citizens.
    Either proposal improves our ability as a state to balance our budget and would increase revenue to protect our investments, improve our economy and maintain our crumbling infrastructure.
    Either proposal serves as a user tax, allowing citizens who smoke to contribute their fair share of the costs placed upon our state.
    The race to the bottom is one we can’t afford to win. I will work this session with like-minded legislators to address this issue of fairness and personal responsibility.

State Rep. Mary Still, a Demcorat, represents Columbia in the Missouri House.

5 responses to “2010/11/24 P-D OpEd:”Cigarette Taxes – Missouri can’t afford to be last”

  1. I think the best response to this 7,600 character pro-tax article is to simply suggest that those with open minds read my “Taxes, Social Costs, and the MSA” article at:

    http://pasan.thetruthisalie.com/modules.php?name=News&file=article&sid=7

    Bear in mind that it was written as an Appendix to Brains — back in 2002/03. Since then I believe there have been the better part of a hundred cigarette tax increases around the country.

    I’d be happy to see cigarette taxes increased as long as gasoline and alcohol were taxed at a similar rate in terms of percentage of base product price. That would give us gas at about $5 to $10 a gallon I believe, and a cheap six-pack or bottle of Ripple would go for about $25+.

    Michael J. McFadden
    Author of “Dissecting Antismokers’ Brains”

    • Michael, Just my personal opinion, but I would certainly favor the gas tax being raised to the levels you suggest, which would help offset the present many subsidies for motoring. I also don’t have an objection to raising alcohol taxes if it helps deter alcohol abuse and drunken driving.

  2. Bend over, Missouri. You’re next in line for nicotine replacement money pouring in! The media wil never tell both sides as nicotine repalcement and pro ban buy all the editorial policy with their pro ban ads. Tens of millions will be spent to buy off your Legislature. (Ask Mary Still) The lobby group called the American Cancer Society, will lead the way, as they got the biggest grant funds from the marketers of nicotine replacement. Ask Mo and Mary WHY they are not lobbying to stop the selling of nicotine. No nicotine sales means no nicotine replacement sales equals no grant handouts to pro ban.

  3. MoGASP,

    Just a reminder that an increase to cigarette tax went to the voters I think in 2006 and was defeated. Missouri has low taxes in many categories and yet is in better shape than most states. Illinois bans smoking and has high tobacco taxes yet is in dire shape.
    While I don’t put either states situation on cigarette taxes. Raising taxes on cigarettes won’t balance the budget.

  4. Tony, you compare MO and IL’s general economic shape in terms of taxes, but it’s good to remember that their smoking ban differences could also be having quite a signficant effect. While Dave Kuneman and I may not have much in the way of formal economic backgrounds, the study we did involved pretty basic examination of completely public and fully verifiable figures and showed a VERY strong relationship between smoking bans economic destruction on statewide levels. See the Economics section of “The New Stiletto, The Lies Behind the Smoking Bans”

    Just Google “v.Gen5H” in quotes like that and click on the first “Health Arguments” item (I don’t have the URL handy.)

    – MJM

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