Missouri - no tobacco tax hike even though facing a budget shortfall as much as $600 million...

January 12, 2011 - In Missouri Marlboro reds, the world's most popular brand, costs $5.14. By contrast, a pack of the same cigarettes runs as much as $13 on the Upper East Side of Manhattan.

Missouri state representative Mary Still, a Democrat from Columbia, groused in a recent editorial, referring to the fact that Missouri now levies the lowest cigarette tax in the U.S.: 17 cents a pack. Missouri won this distinction this past summer when South Carolina lawmakers — shrugging off the influence of the state's tobacco growers — overrode outgoing Republican governor Mark Sanford's veto and raised its tax by half a buck per pack, from 7 cents to 57 cents. New York has the highest cigarette tax, at $4.35 a pack; the national average is $1.45 a pack, according to the Campaign for Tobacco-Free Kids. Missouri - lowest tobacco tax in the nation with no increase in sight...

Both at the polls in statewide referendums and in the legislature, efforts to boost cigarette taxes are repeatedly shot down. Still is trying again in 2011: she's drafting a bill that would hike the tax by 12 cents each year for eight years. But antitax Republicans control both legislative chambers, and Democratic governor Jay Nixon has taken a no-new-taxes pledge. A spokesman for the governor, Scott Holste, wouldn't touch the tax idea with a 10-foot pole. "We're just not gonna weigh in on that right now," he said.

The state is facing a budget shortfall of as much as $600 million next year. University of Missouri, which is staring at a potential $50 million cut from the state next year, recently hosted area lawmakers to brainstorm ideas for closing the budget gap. The cigarette tax came up because it seems to be low-hanging fruit, given the high social costs of smoking. According to the Centers for Disease Control (CDC), 23.1% of adult Missourians are smokers, among the highest rates in the nation. Kentucky is highest, with 25.7% of its residents lighting up. Smoking-related illnesses cost the Medicaid system some $641 million last year, according to the Missouri Budget Project, and the CDC says smoking kills at least 9,500 Missouri residents each year. And studies have shown that increasing cigarette taxes 10% can reduce consumption as much as 5%, especially among young people.

One thing that poses a problem in reforming cigarette taxes is the state constitution. Any major tax increase must go before the voters. (Still's proposed measure would avoid that fate by phasing in the tax in small steps.) In 2006, a proposal to raise the cigarette tax to 97 cents a pack lost a hard-fought referendum, 51% to 49%. Hospitals and health advocates poured millions into the campaign for the tax; opposition came from the tobacco lobby, gas stations and convenience stores. Posters at minimarts and filling stations across the state called for voters to "Stop Tax Abuse" and vote down a "470%" tax increase.

Both at the polls in statewide referendums and in the legislature, efforts to boost cigarette taxes are repeatedly shot down. Still is trying again in 2011: she's drafting a bill that would hike the tax by 12 cents each year for eight years. But antitax Republicans control both legislative chambers, and Democratic governor Jay Nixon has taken a no-new-taxes pledge. A spokesman for the governor, Scott Holste, wouldn't touch the tax idea with a 10-foot pole. "We're just not gonna weigh in on that right now," he said.

In Missouri local communities impose their own levies.

Much of Missouri's steadfast refusal to jack up sin taxes can be attributed to one man. For decades, Jefferson City's most revered and feared lobbyist was John Britton, who worked to protect both Big Tobacco and the brewery interests.

Some supporters of higher cigarette levies have begun to suggest that that this might be a good chance for Republicans to put Governor Nixon in a box. Suppose the legislature passed a cigarette tax to ward off school budget cuts and sent it for the governor's signature: Nixon would have to choose between breaking his no-tax pledge or leaving schools in the lurch.

Reference: Is Missouri Ready to Raise Its Very Low Cigarette Tax?
by Karen Ball, Jefferson City, TIME.com, 1/11/2011.

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