Mississippi - tobacco tax likely to be approved May 6, 2009..

April 29, 2009 - House and Senate conferees agreed Tuesday, April 28th to recommend raising Mississippi's cigarette tax from 18 cents to 68 cents a pack, a compromise that would hold down the cost of car tags and send about $5 million into stop-smoking efforts across the state.

The full House and Senate are expected to pass the tax increase May 6 when they return from a month-long recess. Chief negotiators for each house predicted passage of the tax increase, which is expected to generate nearly $32 million -- when coupled with the current 18-cent-a-pack tax -- between its effective date of May 15 and the end of the 2009 fiscal year that ends on June 30.

The money generated will hold down car tag prices, which were expected to rise July 1 by $135 a year on a $20,000 car or light truck with no new tax revenue under a tax rebate formula. Gov. Haley Barbour has opposed taking any money from the rainy day fund, leaving a higher cigarette tax as the only viable option.

Going into Tuesday's meeting, April 28th Senate conferees had agreed to raise the tax to 64 cents a pack while the House wanted 75 cents. Spontaneous applause, led by a group of physicians in lab coats, broke out when the compromise of 50 cents was announced.

Dr. Karen Crews, director of the Oral Oncology and Biobehavioral Sciences Division of the University of Mississippi Medical Center said the tax increase should cut adult smoking by at least 2 percent over the next year and smoking by teenagers, who have less disposable income, by 6.5 percent. The increase is expected to result in a million smokers giving up the habit and prevent 2 million young people from ever starting, according to the Centers for Disease Control and Prevention. In Mississippi, the Campaign for Tobacco-Free Kids estimated that that state spends $8.37 in health care for every 18 cents, the current state cigarette tax rate per pack, collected in cigarette taxes.

Mississippi's cigarette tax increase comes on top of the federal government raising the tobacco tax April 1 from 39 cents to $1.01 per pack. (Besides federal tax increase - several states want to do the same..)

Reference: Mississippi cigarette tax likely to pass
Raising price of smokes 68 cents would offset cost of car tags
by Phil West, Memphis Commercial Appeal, 4/28/2009.

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