Sunday, Sept. 5, 2004
hike is market-based approach
SC Statehouse Report
5, 2004 -- From a public health perspective, there's no really
good reason for keeping taxes cigarettes low.
Low taxes on cigarettes means they're more affordable, which
translates into more people who smoke. Higher taxes mean cigarettes
cost more, which discourages people from smoking - particularly
the young and those with lower incomes, according to the American
The question of whether South Carolina's lawmakers have the
gumption and foresight to raise the state's abysmally low
7-cent-per-pack cigarette tax begs the question: Is our state
really serious about cutting the smoking rate, which would
improve people's health, extend lives and reduce overall health
costs at hospitals and other medical facilities?
If the answer is yes, raising the cigarette tax is a great
public policy solution. Not only would it lead to improved
health, but it would raise money to offset double-digit rising
health costs for a growing senior population.
But if lawmakers don't want to improve public health, they
need to be honest with voters and let them know that creating
a healthier South Carolina isn't their priority.
For years, lawmakers have been saying a big reason they didn't
want to raise cigarette taxes was because state revenues from
cigarettes would drop because people would flood into other
states to buy cheaper cigarettes.
Economically, that argument has never made sense. If, for
example, the tax merely doubled to 14 cents and half of the
smokers in South Carolina went over state lines to feed their
nicotine habit, the state would still receive about the same
amount of revenue. But somebody from Columbia isn't going
to drive 100 miles to buy a pack of Marlboros.
WORLD: Padding the books
On retro vs. Metro
Who's up and down
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Now a new study shows the argument is politically false too.
According to the American Cancer Society, Georgia raised cigarette
taxes from 12 cents to 37 cents a pack in July 2003. In the
year since, the outflow predicted by anti-tax advocates just
- Georgia's tax revenues from cigarettes rose from $111
million in 2003 to $227 million in 2004.
- During that time, Georgia smokers didn't flood into South
Carolina to buy cigarettes, as reflected in South Carolina's
cigarette tax revenues. For the last three years, these
tax revenues have actually dropped - from $26.4 million
in fiscal year 2002 to $25.4 million in fiscal year 2004.
In other words, Georgia's experience shows the argument that
South Carolina will lose revenues if it raises the cigarette
tax just doesn't hold water.
So here's what will happen next year:
- A coalition of health care groups that advocates a cigarette
tax increase will push hard for it. It won't suggest where
increased revenues should be spent, but sources say they
hope the money will be spent to offset increasing Medicaid
- Unless pressured by lots of people, state lawmakers will
figure out new creative arguments about why they can't raise
the cigarette tax - even though more than 30 states have
raised it. Among those that raised the tax are several in
the South - Alabama, Arkansas, Georgia, Louisiana and Tennessee.
- One argument they'll use is they won't make any changes
in cigarette tax rates unless there is reform to Medicaid
or some other program. Others will trot out a no-tax-hike
pledge that a majority of lawmakers have signed. And others
will say because Gov. Mark Sanford will veto any stand-alone
tax hike, there's no point in getting into the battle.
Let's hope none of these insincere arguments carry the day.
Instead, let's hope the state's Republican leadership will
fight to marry a great public health benefit (lowering health
costs by reducing smoking) with the core GOP principle of
Raising taxes on cigarettes doesn't take away anyone's right
to smoke. But if Republicans use a higher tax as a market-based
incentive, more people will kick the habit and save their
lives. In the meantime, the state will be able to generate
more revenue to pay to help even more people to become healthier.
9/5: Padding the books
This week's cartoon by our Bill McLemore:
8/29: Retro vs. metro is the battle
To the editor:
Really nice piece (Statehouse
Report, 8/29). Maybe you could have softened the "using
the dangers of terrorism and war to..." or expressed
this as a summary of the book. But, the conclusions bring
it back to center. It is a rural versus metro battle. Funny
thing, the Internet and incredible communication tools that
are developing will help to merge these two kingdoms. There
is a lure for people to return to smaller towns for quality
of life reasons. They will still be able to be connected to
"metro" by quickly improving electronic means. This
migration is some time away however.
[That's a] big point these retros never admit; metro supplements
their very existence through cash flows back to poorer areas
as you mention. South Carolina gets $1.40 back for every dollar
it sends to Washington. What a deal! And yet politicians make
hay blasting Washington. If I were Connecticut, I'd be mad
as hell for supporting "retro" and being demonized
at the same time. It is time for a little intellectual honesty
-- Jim Brooks, Greenville, S.C.
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SOUTH CAROLINA SCORECARD
Here's a "thumbs up" and "thumbs down" related to various
political events from the past week:
Tucker Eskew. The Greenville native is showing what
he can do as one of the GOP's best spin doctors during the
Republican National Convention.
Mark Sanford. The neverending one-upsmanship our governor
carries on to show he's frugal is getting worn. Earth to Sanford:
You're governor. You need to look like it, not live in the
pool house and look for laudatory editorials about how great
you are for pooling it.
Lobbyists. Fewer lobbyists filed ethics reports because
of a reinterpretation of state law. We should have more openness
and filing, not less.
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Notes veteran lawmaker Sen. Glenn McConnell: "Statehouse
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In each issue of Statehouse Report, you'll get::
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McLemore's World -- an early view of our respected
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Tally Sheet -- a weekly review of all of the new
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Scorecard -- A Thumbs Up and Thumbs Down of major
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Calendar -- a weekly list of major meetings for
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Megaphone -- a quote of the week that you'll find
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