Va. May
Raise U.S.'s Lowest Cigarette Tax
By LARRY O'DELL, Associated Press Writer
RICHMOND,
Va. - Plans to raise Virginia's cigarette tax have always wound
up in the legislative ash heap, snuffed out by the politically
muscular tobacco industry and lawmakers keenly aware of state's
400-year history of reliance on the golden leaf.
As other states have raised cigarette taxes as high as $1.51
per pack to replenish depleted state treasuries and discourage
teen smoking, Virginia held fast at 2.5 cents — the nation's
lowest tax on a pack of smokes — even when faced with unprecedented
budget shortfalls.
Now, legislators say 2004 is likely to be the year Virginia takes
aim at tobacco.
As part of a tax reform package, Democratic Gov. Mark R. Warner
has proposed upping the state's cigarette tax to 25 cents per
pack and allowing all localities to impose an additional tax of
up to 50 cents.
Warner estimates the increase would produce an additional $150
million annually for his treasury. He has said the state would
face a $1.2 billion shortfall if lawmakers don't adopt his tax
reform package.
"I really think we are going to increase the tobacco tax
this year," said Republican state Sen. Emmett W. Hanger,
but he added, "I don't think we'll get anywhere near the
governor's proposal."
A cumulative increase of up to 75 cents per pack would be "overly
punitive to the tobacco industry," Hanger said.
Seventy-five cents per pack still wouldn't be anywhere near the
highest taxes in the country. New York state last year increased
its cigarette tax to $1.50 per pack, and New York City imposed
another $1.50 tax, bringing the cost of a pack of cigarettes to
more than $7 in New York City.
Massachusetts taxes cigarettes at $1.51 per pack, New Jersey's
state tax is $1.50, and Washington state's is $1.42.
In Virginia, cigarette tax debates have historically pit public
health advocates against the tobacco farming and manufacturing
lobbies — a mismatch in a state where tobacco remains the
No. 1 cash crop and factories produce billions of cigarettes annually
for sale worldwide.
Philip Morris, which operates the world's largest cigarette factory
in Richmond, promptly denounced Warner's proposal as "excessive."
However, company officials declined to say whether they will actively
oppose a tax increase as they have in the past. As recently as
last winter, Philip Morris helped kill legislation that would
have increased the tax to 60 cents per pack.
The Virginia Farm Bureau will fight the proposal, lobbyist Martha
Moore said. "We feel this is singling out one farm commodity,"
she said.
But Virginia Lung Association spokeswoman Kendra Powell and Michael
Berman, spokesman for the Campaign for Tobacco Free Kids, have
hope for a tax increase going through. Berman said every 10 percent
increase in the price of a pack of cigarettes leads to a 7 percent
decrease in youth smoking.
"It's been a long, long fight," Powell said. "We
still have a battle ahead of us, but we're optimistic. We're going
to save lives with this increase."
Some smokers aren't happy with the prospects and say a higher
tax won't make them quit.
"It's ridiculous," Rhonda Pusloskie said between drags
of a Marlboro outside a Richmond office building. "They get
enough money off us already."
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