WASHINGTON -- Lawmakers have banned tobacco sales at convenience stores in the U.S. Senate's half of the U.S. Capitol Building, said the AHN news service. The decision, backed by high-ranking members of the Senate Rules Committee, ended a discount that let staffers buy cigarettes sold on Capitol Hill without paying sales tax. Cigarettes generally sell for more than $4 a pack in the District of Columbia, but for as little as $3 in the Capitol Building, the report said.
The ban is a symbol of the tobacco industry's ongoing woes. Congress is currently seeking [image-nocss] to increase the federal tax on cigarettes either as part of the legislation to expand the State Children's Health Insurance Program (S-CHIP) or in another bill. Lawmakers are trying to craft a veto-proof version of the S-CHIP bill after President Bush, who vetoed the first attempt, said he would oppose any legislation that seeks to raise tobacco taxes. So far, the bill has included a 61-cent-per-pack increase on the federal excise tax on cigarettes, as well as increased taxes on other tobacco products.
A Senate committee recently approved legislation that would, for the first time, allow federal regulation of cigarettes. The bill, also pending in the House, would require the Food & Drug Administration (FDA) to restrict tobacco advertising, regulate warning labels and remove hazardous ingredients.
Opponents claimed that the tobacco industry no longer has the clout it once did. Critics said health concerns have "deeply eroded" the industry's influence in Congress.
Philip Morris USA, the nation's largest cigarette maker, sponsors a website, mailings and a toll-free number urging people to ask Congress to sustain Bush's veto, said an Associated Press report. "Taxing smokers is unfair," the materials said, adding that states have increased sales taxes on cigarettes 73 times since 2000.
"We are sharing our position with legislators," PM USA spokesperson Bill Phelps told AP. The company also has encouraged tobacco growers, retailers and wholesalers to get involved, he said.
The tobacco industry gave $3.5 million to federal campaigns and candidates in the 2006 election cycle, ranking 64th among major industry groups, according to the Center for Responsive Politics; 10 years earlier, it gave $10.5 million, ranking 26th.
Meanwhile, the Senate Committee on Commerce, Science & Transportation was set to host a committee hearing yesterday to examine the accuracy of the Federal Trade Commission's (FTC) tar and nicotine cigarette rating system and the marketing claims of cigarette companies based on these ratings. The FTC has raised concerns about the testing methods and has admitted in prior congressional testimony that its ratings tend to be relatively poor predictors of tar and nicotine exposure, noting how machine-measured tar and nicotine ratings are not an accurate reflection of tar and nicotine intake.
The committee was scheduled to review the FTC's jurisdiction over deceptive marketing and advertising practices. It was set to explore tobacco companies' marketing of light cigarettes to Americans, the use of light and ultra light in cigarette manufacturers' advertising practices and the public health implications of changes in cigarette design.
Representatives from the FTC, Centers for Disease Control & Prevention (CDC), and the medical research community are among witnesses scheduled to testify at a committee hearing on the Accuracy of the FTC Tar and Nicotine Cigarette Rating System.
On the positive side for tobacco, Oregon voters rejected a proposal Tuesday that would have raised the state's cigarette tax by 85 cents to $2.02 a pack to pay for children's health care; 60% of voters voted against the measure, said The Winston-Salem Journal. Tobacco manufacturers spent $12 million on efforts to defeat Measure 50, including $4.9 million by R.J. Reynolds, in the most expensive initiative in Oregon history. By comparison, proponents of Measure 50 spent $3.2 million.
In November 2006, voters in California and Missouri rejected ballot initiatives that would have increased the state cigarette tax, while voters in Arizona and South Dakota approved initiatives. Reynolds spent about $40 million to defeat the California initiative.
Voters determined that it would have been unfair to target smokers in Oregon, who represent 20% of the population, to pay for a program that would have benefited a much broader segment of the population, John Singleton of RJR told the newspaper. We also addressed the latitude of how the tax increase could have been spent, and that it was not a good fiscal match to fund a growing health-care program with a product whose consumption is declining.
The size of the margin of victory in Oregon surprised analysts considering that voters approved cigarette-tax increases in 1996 and 2002. The tobacco industry basically bought an election, Governor Ted Kulongoski told The Oregonian of Portland. I don't think it's a reflection of what Oregonians think about health care and children.
A new proposal to raise the California cigarette tax by $2, to $2.87 a pack, would provide part of the $14 billion needed to finance a universal health-care plan. It also would include a fee on employers and hospitals, said Alicia Trost, a spokesperson for Don Perata, the president pro tem of the Senate. There are 6.7 million uninsured Californians, according to The Associated Press. Trost said that if the legislature approves the bill, it could be put on the November 2008 ballot.
Democrats said they favor a cigarette-tax increase rather than a proposal by Republican Gov. Arnold Schwarzenegger to privatize the state's lottery to finance the health-insurance program. Schwarzenegger has rejected all calls for tax increases since becoming governor in 2003. Sabrina Lockhart, a spokesperson for Schwarzenegger, told the paper that he has not commented about a willingness to negotiate on the cigarette-tax proposal.
Analysts said that the main reason why California voters rejected raising the cigarette tax by $2.60 a pack in November 2006 is that the increase was too high. Voters approved raising the cigarette tax by 25 cents in 1988 and by 50 cents in 1998.
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