Bill will raise tax on tobacco products

Smokers and dippers alike might be shelling out a little more dough to indulge in the nicotine habit, if three lawmakers have their way in this session. A fresh bill put before the Senate in Tuesday’s session would hike the tax on cigarettes and smokeless tobacco, possibly generating up to $120 million. As written, the measure would jack the tax on cigarettes to $1.55 per pack, or a $1 increase. The tax on smokeless products would go from the current rate of 7 percent of the wholesale price to 50 percent. Up to $60 million would be put into a special account known as the “West Virginia Healthy Future Fund.” From that, the Department of Health and Human Resources would get $27 million to implement prevention and cessation programs in line with the Centers for Disease Control and Prevention, and any leftover cash would be appropriated by the Legislature on an annual basis. “It’s a significant increase,” a co-sponsor, Sen. Dan Foster, D-Kanawha, acknowledged.

“The reason for doing it from my standpoint is the public health effects. It decreases the prevalence of smoking by a certain percentage, particularly by young people.” Not only that, Foster maintains, but the higher tax would ultimately save the state money in future health care costs. “Although, as people stop smoking, it cuts down a little bit the money you get from the tax,” the Charleston surgeon said. Foster said he wants proceeds from the tax, if approved, dedicated to public health. “As a public health purist, you shouldn’t care that much as long as the tax is in place, that it will raise the price and keep some people from starting and make some people stop and maybe cut down the amount of people that smoke in general because of the costs,” he said.

There are some admittedly who view this as a tax on the poor, and Foster sees this as unfortunate. “Many of these people can stop,” he said. “My hope is to provide services that would be one source of dedication of the money to cessation services so that people who want to stop, have difficulty stopping, and really can’t afford to continue smoking have an outlet where they can stop and have themselves a whole lot more money.” Another physician, Sen. Ron Stollings, D-Boone, who chairs the Health and Human Resources Committee, and Finance Chairman Roman Prezioso, D-Marion, are the other sponsors. Prezioso prefers to see some of the proposed tax increase go to the troubled Medicaid account. “I’d put it into Medicaid,” he said.

“That’s where I want it to go.” Prezioso says the Legislature faces the difficult task next year of finding $200 million for Medicaid. “We swept all the accounts this year,” the finance chairman said. “We’re out of money in the trust fund after this year’s budget. There are no other options. You’re either going to raise other taxes or other fees, or you’re going to decrease the services in Medicaid. It’s a tough decision.” Prezioso said he prefers to find a tax “we can live with now, put it in place, and dedicate those funds to Medicaid.” “That’s where it’s needed,” he said. “That’s going to be our biggest problem next year.” Foster acknowledged the tobacco tax increase — any such hike, for that matter — faces an uphill climb in an election year. “Nobody likes to raise taxes,” he said. “But if you poll the public, regardless of political persuasion or ideology, in excess of 60 percent of the public supports an increase in the cigarette tax. It seems like it’s good politics as well as being good policy.”