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Great hearings and great press!

Thanks to everyone who participated in the Senate  hearing for our Healthy Maryland Initiative yesterday. Here is a great article from the Maryland Reporter and blog post from the Maryland Budget and Tax Policy Institute about our initiative:

 

Another tax hike on cigarettes and cigars gets kicked around

March 14, 2013 at 12:03 am
By Becca Heller
Becca@MarylandReporter.com

Tobacco lobbyists and anti-smoking advocates went head to head in a high-stakes hearing Wednesday on the legislature’s latest proposal to raise the tax on a pack of cigarettes from $2 to $3. The tax rate on cigars would triple from 30% to 95%.

Sponsored by Sen. Verna Jones-Rodwell, this is the third year the bill to raise cigarette and tobacco taxes has been filed in both chambers of the General Assembly. Though legislators haven’t had success in passing it yet, Maryland’s not-so-distant past reflects a spate of tobacco tax increases.

“We have made tremendous progress over the past decade in reducing the smoking of cigarettes, with cigarette smoking dropping by 32 percent in this time (double the national average), as a result of three increases in the state tax on cigarettes over the past decade,” said Vincent DeMarco, president of Maryland Citizens’ Health Initiative.

Bill would reduce smoking, raise $100 million

Proponents of the bill presented an arsenal of arguments in support of the tax, including health statistics, economic points, and testimony from teens.

“Many students that spend hours working to save up for their very first car to make sure to take a few dollars of their paycheck to feed their cigarette habit,” said Devan Ogburn, a sophomore at Leonardtown high school and president of the Maryland Association of Student Councils. “If you raise the already high prices of tobacco products, many youth will realize that the habit isn’t worth the empty wallet.”

According to Health Care for All, the Maryland Citizens’ Health Initiative, not only have prior tobacco taxes prevented over 200,000 Marylanders from smoking regularly, but they have also helped fund health care for over 300,000 Marylanders.

The bill in question, they argue, would raise about $100 million in additional revenue.

Opponents: Bill punishes adults buying legal products

Opponents to the bill came out swinging.

“This bill is about taxing adults. The argument is about children and cost and it’s really overplayed,” said Bruce Bereano, representing the Maryland Association of Tobacco and Candy Distributors. “Whether you like it or not, the use and possession of tobacco products by adults is legal. Let’s put a bill in the legislature and make it illegal to smoke or possess tobacco. Don’t hassle them by taxing them.”

Bereano also accused proponents of the bill of exaggerating the extent to which tobacco companies targeted teens and children.

Buyers could go to Virginia for much cheaper cigarettes

Other arguments countering the bill suggested that, rather than deterring smokers, the initiative would simply encourage cross-state sales and open up the state market to contraband tobacco.

Dan Doherty, the lobbyist for the Cigar Association of America, said that the difference between taxes for a carton of cigarettes in Maryland and Virginia is currently $34, but will jump to $54 under the bill.

“Why wouldn’t people go into Virginia to stock up and then come back to Maryland?” Doherty asked.

Statistics from a poll conducted for Health Care For All, however, suggest that while some may oppose the tax, nearly three quarters of Marylanders support the initiative.

“Maryland has been a national leader in reducing addiction to cigarettes, especially among teens,” said DeMarco. “Now, let’s build on this progress by enacting another life saving one dollar per pack cigarette tax increase, continuing the tremendous public health progress Maryland has made.”

Cigarette Tax will Help Budget and Save Lives
Maryland Budget and Tax Policy Institute Blog
March 13, 2013

The legislature is considering legislation to increase taxes on cigarettes. This would both raise funds to help resolve Maryland’s remaining “structural budget deficit,” and would discourage smoking – especially among teenagers and young adults.

Senate Bill 700 and House Bill 683 would increase the tobacco tax rate from $2.00 to $3.00 per pack. It would also increase the tax rate on other tobacco products (like chewing tobacco and pipe tobacco) from 30 percent to 95 percent of the wholesale price (excluding certain cigars), and mandates minimum and maximum tax rates for certain other tobacco products. These bills would also guarantee at least $21 million in annual funding for tobacco cessation programs, beginning in fiscal year 2015, and divert additional funding to other health care programs.

The Maryland Budget and Tax Policy Institute supports these bills because of the significant public health benefits of reducing smoking. Previous increases in the tobacco tax have reduced smoking in Maryland twice as fast as the national average, saving lives and taxpayers’ money by reducing the need for health care. Adding another dollar to the per-pack cost, along with the other increases in SB 700 and HB 683, will save many more lives.

It will also raise money for important health programs—perhaps as much as $81.5 million in fiscal year 2014 according to the fiscal note.

SB 700 and HB 683 would also put the brakes on the disturbing upward trend in cigar use by young Marylanders. Increasing the tax on these products to put them more on par with cigarettes would quickly reduce the number of underage users of these products, protecting their health and well-being.

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