COLUMBIA, S.C. - Gov. Mark Sanford's push to reduce the state income tax failed a key test in the Senate Thursday night.

The Senate voted down the tax cut, which was tied to a 53-cent-a-pack increase in cigarette taxes, 27-18.

The higher cigarette tax would have generated about $171 million needed for the state Medicaid programs for the poor, disabled and elderly. The tax reduction would have moved income tax rates from 7 percent to 5 percent during the next few years, depending on how fast income tax collections grew as the economy recovers.

The cigarette tax increase was a key element in a $5.1 billion budget. Without it, and with a variety of smaller tax increases, fees and raids on accounts, the Senate's total budget is now more than $381 million less than when it hit the floor on May 6.

Sanford's plan failed after an hourlong debate. Sen. Verne Smith, R-Greer, told the Senate that there was no other clear way of rescuing Medicaid programs from cuts.

But Sen. Jake Knotts, R-West Columbia, said the Senate should send a message to "let them know we're not going to throw good money at a bad situation."

He held up a special boot made for a woman who had lost her toes, noting that it's sole was peeling after being worn once. Medicaid paid $1,577.48 for the shoe. "This type of abuse and fraud needs to be taken care of before we start taxing a certain segment of society to fund it," Knotts said.

Sanford's tax plan could re-emerge next week as the Senate continues the longest budget debate in years.

Hours of closed-door meetings led Democrats and Republicans to agree to a second reading of the state spending plan although they had barely debated the budget's details.

For instance, Sen. Scott Richardson, R-Hilton Head Island, made another attempt at raising the cigarette tax and the sales tax, but that plan fell victim to Senate rules. That's the same fate that befell other attempts this week.

"The mood in the Senate is not for tax increase," Senate Finance Committee Chairman Hugh Leatherman, R-Florence, said.

Nonetheless, Sen. Tommy Moore, D-Clearwater, said he'd try to rally support again for a plan that raises the sales tax to 7 percent from 5 percent. It also gives a variety of tax breaks while increasing state spending on education and restoring lost funding for a dozens of state agencies.

For much of Thursday, Democrats and Republicans used Senate rules to scuttle portions of the House's version of the spending plan.

Senate President Pro Tem Glenn McConnell, R-Charleston, worked to kill House provisions that tapped interest from privately-funded trust accounts supporting operations at the Patriots Point Naval and Maritime Museum in Mount Pleasant, including sailors donating to the USS Laffey, and at Parks, Recreation and Tourism Department facilities, including historic mansions.

"But the House swept the interest off those private donations to help balance their bill," McConnell said.

If anyone in the private sector tapped a trust fund like that, "there would be some eyebrows raised," McConnell said.

Knocking out the House budget provisions, including a $25 surcharge on traffic and other court fines, has worried people watching the debate.

State Law Enforcement Division Chief Robert Stewart said he's counting on that surcharge to restore some of the budget cuts in his agency. It's lost $10.8 million in funding to budget cuts in the past two years and is down 60 SLED agents, he said. The surcharge would put $3.6 million back into his budget and help head off other cuts, he said.

Leatherman said there will be an effort to restore those fees next week.