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Cigarette tax hike gets thumbs down from local lawmakers

Gov. Mark Sanford’s proposal to raise the cigarette tax by 30 cents to fund income tax cuts in the state’s 2007 budget isn’t getting much support from local state legislators.

The governor’s $6.5 billion spending plan includes $205 million for income tax breaks, with nearly half coming by raising the state’s cigarette tax from 7 cents to 37 cents a pack.

At present, South Carolina has the lowest cigarette tax in the nation.

District 9 S.C. Rep. Michael Thompson, R-Anderson, said the only way he will support the proposed tax hike is if the revenue is used to offset soaring healthcare costs.

“It would need to be directly plugged into healthcare costs,” Rep. Thompson said. “I think it would garner a lot more support. Healthcare costs are growing. There’s the increased cost of medicines in general and the Health and Human Services budget is constantly growing.”

District 10 S.C. Rep. Dan Cooper, chairman of the House Ways and Means Committee, R-Anderson, said he opposes the increase because it’s a dwindling source of revenue that would create future problems for state government.

“I’ve been opposed to a cigarette tax or any tax increase, but particularly the cigarette tax,” he said. “You’re replacing another revenue source for the state in which the goal is to get less people to smoke and at some point you create a revenue problem (because less people are buying them).”

District 2 S.C. Rep. Bill Sandifer, R-Seneca, said he disapproves of the governor’s proposal for several reasons, including the fact it would be temporary.

“I just think that the only way to appropriately address the situation is through permanent legislation,” Rep. Sandifer said. “That way, we don’t have to readdress it every year.”

Like Rep. Cooper, Rep. Sandifer said tax cuts need to be funded from a stable source that would not be susceptible to decreases in revenue.

That view also is held by District 6 S.C. Rep. Brian White, R-Anderson.

“I don’t think it’s such a wise idea to replace an income tax with something that’s going to produce a diminishing return,” he said. “I don’t think it would be the prudent thing to do.”

But Rep. White said he would consider increasing the tax if it was applied toward healthcare costs.

District 3 S.C. Sen. Kevin Bryant, R-Anderson, said he would not endorse raising the cigarette tax unless income tax relief is provided to individuals instead of businesses.

“It’s very rarely I see a tax cut I didn’t like,” Sen. Bryant said. “I would prefer the tax cuts go to the individual. We gave a business tax cut two years ago.”

Sen. Bryant said smokers are putting a strain on the state’s healthcare system, contributing to higher taxes for non-smokers.

“Right now, our Medicaid costs overwhelmingly go to those who smoke,” Sen. Bryant said.

Comments

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Posted by StupidShouldHurtMore on January 4, 2007 at 11:59 a.m. (Suggest removal)

Great ...

Our legislative delegation misses the boat once again. None of the reasons supplied are with merit and resemble excuses rather than action. To attempt to tether the tax increase on cigarettes to a matching spending on reducing rising health care cost is not only silly, but illogical.

Yes - health care costs are on the rise. However, the rise in heath care costs can not be left at the feet of the unhealthy individual. Rising costs in health care can be attributed to the millions and millions of dollars annually poured into ad campaigns for medicine. Why would I want revenue from a tax increase to go towards something for which we have ZERO spend control? Illogical at best.

As for the argument of diminishing returns, lets apply that logic to another industry - oil. Every time you drill into a well and pump oil out, you have a source (product) that diminishes over time. You still profit from that diminishing source. Why leave it untapped?

Illogical at best are the arguments provided by our electorate. I would expect better than this.

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