MADISON, Wis. -- Governor Jim Doyle said he was open to a $1-per-pack increase in Wisconsin's cigarette tax as long as the money is used to deter smoking and help pay for health care, reported the Associated Press.
A council convened by Doyle to study health care suggested adding $1 to the state's 77-cents-per-pack tax as a way to pay for programs that reduce the cost of health insurance and the number of uninsured.
Doyle was cool to a similar plan defeated by lawmakers two years ago, but said in an AP interview that he saw real [image-nocss] positives to an increase in the cigarette tax.
He added, To the extent that it is used to keep young people from starting to smoke, helping people who are addicted stop and helping to pay the cost of tobacco-related illnesses, it makes some really good sense.
The Healthy Wisconsin Council's draft report said the increase would raise an additional $227.5 million in revenue every year while decreasing youth smoking.
The governor said he would insist that any cigarette tax increase be used to pay for health care. He said he is still angry that lawmakers spent the state's tobacco settlement money in one lump sum to balance the budget in 2002 rather than receive annual payments that would have totaled $6 billion over 25 years.
As attorney general, Doyle led the state's lawsuit that won the settlement from tobacco companies. Wisconsin would have gotten $180 million this year under the deal, he said. That's more than what the state will spend this year to provide prescription drug discounts to more than 100,000 seniors and health insurance to 96,000 working poor. Having gone through that experience, I'm not about to create a pot of money that comes out of the pockets of people, many of whom were addicted at young ages to tobacco, for legislators to spend it on whatever they want to spend it on, Doyle said.
The cigarette tax increase is likely to receive a mixed reception in the Legislature as it did two years ago when neither Republican leaders nor Doyle pushed for it. Incoming State Assembly Speaker Mike Huebsch (R) has been cool to the idea, but incoming State Senate Majority Leader Judy Robson (D) said she was open to it.
Doyle's spokesperson Matt Canter said the governor's position hasn't changed. He said Doyle has always been open to a cigarette tax increase as long as it funded health care. The governor in the last session never saw a proposal to get that done, Canter said.
Wisconsin's cigarette tax ranks 30th among the states, according to the Campaign for Tobacco-Free Kids. A $1 increase would make it the ninth highest in the country, according to the group.
Doyle said the dramatic hike would make sense. If you're going to do a cigarette tax, you really want to have it bring down smoking rates, he said. There's got to be real shock value to what happens. Little incremental increases don't achieve that for you.
Meanwhile, South Dakota's state tax on cigarettes is scheduled to go up by $1 pack on January 1, but a state legislator might try to roll that back.
State Senator Garry Moore (D), who moves to the South Dakota House next month, said he might introduce a bill to reduce the tobacco tax increase that voters approved last month.
And in Texas, the $1-per-pack cigarette tax increase approved earlier this year goes into effect on January 1, said KCEN-TV. The almost 344% boost from the existing 41-cent state tax is part of a plan Texas lawmakers approved to lower local school property taxes by increasing and expanding some state taxes. Money from the higher cigarette tax, as well as money from an expanded business tax and other changes, will replace money schools will lose under a new limit on the rate they can charge for local school property.
The state comptroller's office estimated that the $1 increase will generate an additional $427 million in fiscal year 2007 (September through August). In 2008, it will give the state an extra $683 million; in 2009, it is expected to give the state a $723 million boost. Those estimates are based on a variety of factors, including the likelihood that some people will cut down or stop their smoking while other smokers in border regions will purchase cigarettes in neighboring states. Of the expected revenue, 95% will go toward the state's property tax relief fund; 5% will go toward tobacco cessation and prevention programs.
Texas ranked 40th in cigarette taxes at the beginning of this year, according to the report, citing the Federation of Tax Administrators. If the other states keep the same tax rates, then on January 1, Texas will have the 11th highest cigarette tax in the country.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.