/Where there’s smoke there may be a tax increase Republicans can support

Where there’s smoke there may be a tax increase Republicans can support

The most striking thing about this bill is not its unorthodox bottom line, but the powerful Republicans backing it, namely Gov. Phil Bryant. This bill would raise the cigarette tax by $1.50 per pack. The governor has not publicly supported it. Bryant told Mississippi Today, under anonymity, that if there was a tobacco tax on his desk, he would sign. Their offices did not authorize them to speak on behalf of the governor. “Gov. Clay Chandler, the director of communications at the governor’s office, said that Bryant supports generating new revenue and halting unhealthy behaviors like smoking. “He will review any bill that raises taxes on cigarettes if it reaches his desk.” Bryant hasn’t signed a tax hike since he became governor six years ago. His backing would be considered an important milestone in the bill’s journey to becoming law. According to those who support a cigarette tax hike, Bryant’s support would make the bill more viable than most other proposed taxes in the state. When told about the support of the governor, Katherine Bryant from the American Heart Association stated that “it’s unexpected momentum (for bill), and it’ll be taken.” Bryant’s support does not guarantee that the bill will become law. Bryant has not signed any new taxes since he took office. This is because none have yet made it to his desk. While several prominent Senate Republicans support a cigarette tax and Lt. Governor. Tate Reeves is sticking to his promise of no new taxes. Laura Hipp, spokesperson for the lieutenant governor, stated that Tate Reeves has never supported increasing taxes on anyone and that he doesn’t see it changing anytime soon. The bill is not dead but this does mean it faces a difficult task to make it to the House. Senate Bill 2701 is currently being double-referred to both the Senate Finance, and Medicaid committees. This tactic is commonly used to kill legislation. This bill must be voted on by the Finance committee before it can be considered for consideration. Both the Finance committee chairmen supported the bill in this instance. The bill’s sponsor, Sen. Brice Wiggins (R-Pascagoula), has claimed that a tobacco tax is a strong conservative policy since health problems associated with smoking are a financial drain to the state, especially the Division of Medicaid. The bill will help to offset many of these expenses financially and discourage people from smoking. Wiggins stated that taxes are not something the Republican majority, or anyone in general, like taxation. “But, we have a serious health problem in this State, and there are things that we can control and cost we can reduce. This is the fastest way to get it done.” Mississippi’s annual health care costs for smoking in 2016 topped $1.23 trillion. The state’s Division of Medicaid, which offers health care to almost a quarter of the state, took a large part of this. The agency doesn’t keep track of the direct cost of smoking, but it is likely that the total amount is hundreds of millions of US dollars. 2013 was a record year for second-hand smoking, with costs totaling $36 million. Wiggins’ bill is unique in that it directly addresses the link between smoking and Medicaid. Mississippi’s current cigarette tax is 68c per pack. This is the 12th-lowest in the nation. The bill would increase that tax to $2.18 per pack. Then, all the new tax revenue — about $200 million annually — would be diverted into a special fund called “Medicaid Program tobacco Cessation fund.” This fund would first be used for any Medicaid deficits. Over the past four years, that amount has averaged $45million per year. The remaining dollars would be used to fund a tobacco cessation programme. Federal matching dollars are technically available for every dollar that is spent on Medicaid. Every dollar spent on Medicaid in Mississippi, the state with the highest federal match, is matched by three federal dollars. This means that $200 million could be converted to $800 million by the state for an agency whose cost-covering problems are frequently the most controversial issues in the legislative session. Dr. Steve Demetropoulos is the director of the Medical Care Advisory Committee. This committee advises the Mississippi Division of Medicaid policy. “Putting a tobacco tax — people who smoke are the most likely to need medical care. By redirecting the money back into Medicaid, the tax can pay for services that patients won’t be financially able. Some of these people may be in good health right now. But what happens to them when they reach 50 and have a stroke or become disabled? Guess what? They’ll be on Medicaid.” Since the beginning of the session, the American Heart Association, Mississippi State Medical Association, American Lung Association, and the Department of Health, along with more than a dozen other national and state organizations, have been pushing for a $1.50 tax hike. These groups will hold a press conference about the increase on Thursday morning. These groups provided data that shows how a $1.50 tax hike can reduce smoking in the state. A 10 percent increase in the price of cigarettes can lead to a 5 percent drop in smoking. A $1.50 tax on cigarettes could reduce the state’s smoking rate by 15% at an average price of $4.50 per pack. This is assuming the law passes within the first year. Katherine Bryant, Heart Association, stated that although it might not seem like much, it could have a huge financial impact on the state. Mississippi’s last cigarette tax increase was in 2009. The Legislature approved an increase of 50 cents to the tax which was 18 cents per pack. The state’s pack sales have fallen by almost a third since then. The number of packs sold in the state dropped nearly 20% within the first year following the passage of the bill. It went from 263,000 packs per year to 207,000 in 2010. Because they believe it will have the maximum impact on quitting smoking, advocates of the tax are targeting $1.50. At a November press conference, Dr. Mary Currier (the state health officer) stated that increasing the tax on cigarettes by less than $1.50 “doesn’t have much effect.” However, this amount could prove to be a sticking point for Republicans who support an increase in the statewide tobacco tax. People who spoke with him said that the governor was in favor of a tax, but had not committed to a $1.50 rise. Joey Fillingane (R-Sumrall), is the Chairman of the Senate Finance Committee. He said that a $1.50 tax increase would make the state the 14th highest in the country. Fillingane stated that those who claim they can’t afford $1.50 are misinformed. To pass this bill, we need to get at least a certain amount of votes. This means that we have to deal with the possible and not the ideal. Fillingane expressed hope that the bill will pass. Fillingane stated that although we are not generally against tax increases in the state Senate’s, you can make a strong public argument that the more expensive tobacco products the less likely young people will start smoking and those who are already smokers may find it prohibitive to continue. Even though it is a Republican-friendly tax, any tax is still a tax at the Mississippi Capitol. A few tobacco taxes are not even brought up in the committee every year. Similar problems have been experienced with other use taxes. Although a gasoline tax increase has been a hot topic in many sessions, the Legislature has not voted to increase it since the 1980s. In 1991, the Legislature was the last to vote on increasing the sales tax. While the potential $800 million top line is the most striking part of this bill, Fillingane and Wiggins are quick to shift away from talking about revenue to emphasize the bill’s primary purpose of improving the health of Mississippians. A gasoline tax would likely be driven by revenue for one project. Fillingane stated that the tobacco tax is an entirely different beast. You can argue that raising this tax will improve your overall health. Amazing health benefits are projected for a $1.50 tax hike. The American Heart Association data shows that the tax would have decreased youth smoking by 16.8 per cent after a year. In the same time frame, another 26,500 adult smokers will quit. “This is Mississippi’s best chance to improve the health of Mississippians almost immediately. It’s not possible to make people eat better overnight. Demetropolous stated that you won’t change the lifestyles of those who are sedentary. “But this one of those things you can just flip the switch.” However, even though health care is a matter of economics, some supporters of the bill believe that the strongest argument for a tax, and possibly the most conservative, lies in the impact a healthy population could have on Mississippi’s economy. Mississippi currently has the fourth highest rate of adult smoking in America at 23 percent. The national average is just slightly above 15 percent. Mississippi is also known for its unhealthy population. It often ranks dead last on many national health indicators. Demetropolous says these two factors are “absolutely connected” and that unhealthy populations can cause problems. Wiggins agreed. Wiggins stated that a healthier workforce means more jobs (Mississippi can attract) that are better-paying and have insurance. A healthy workforce is essential for achieving the A-1 solution when trying to grow jobs. Wiggins stated that this is a natural part of the A-1 solution. The idea of a Mississippi cigarette tax is very popular among Mississippians. According to a Mississippi State University study, 72 percent of Mississippians would support raising the cigarette tax. This is the second most popular tax increase, after alcohol. Fillingane admits that Tate Reeves will decide whether or not the governor signs legislation to increase the cigarette tax. Fillingane stated that if we choose to view it, it will be in the interest of improving health outcomes rather than generating money for a program. “Of course the lieutenant governor sets state health policy, so we’ll work closely with him.”_x000D