California - lawmakers may consider $1.50-per-pack cigarette tax hike..

May 26, 2009 - Next month lawmakers will consider a proposal to hike cigarette taxes by $1.50 per pack and raise $1.2 billion annually. During the last decade, cigarette makers have spent tens of millions of dollars to kill 14 straight attempts to make smokers pay more. (Forty-five states have raised tobacco taxes during the last decade, but not California.) But with the state facing a staggering $21.3-billion deficit and due to run out of cash in July, the tobacco tax could have a better chance of passing the Legislature. Given the serious budget shortfall we face, this is the year to pass the tobacco tax," said Sen. Alex Padilla (D-Pacoima). "It is needed now more than ever."

Padilla wrote the current proposal with Senate leader Darrell Steinberg (D-Sacramento), but even with Steinberg's support, it faces an uphill battle. The tobacco industry sees California as a crucial market and a trendsetter for anti-tobacco ideas that can spread through the country, said Beverly May, regional director of Campaign for Tobacco Free Kids, a Washington anti-smoking group.

"The tobacco companies view California very much as a battleground state," she said. "California is a state that they look at as important to do everything they can to have influence in any way they can." In 2006 voters defeated a $2.60-a- pack tobacco tax, Proposition 86, in a 48 to 52 percent vote. Opponents, primarily the tobacco industry, spent more than $65 million to campaign against it.

Despite California's health-conscious image and laws that ban smoking just about everywhere, including bars and beaches, the state's cigarette tax of 87 cents per pack is lower than such taxes in other states. In Rhode Island, where tobacco taxes are highest, the levy is $3.46 a pack.

This year, R.J. Reynolds and Philip Morris USA, the two largest tobacco firms, are not among the groups that have sent letters to senators expressing opposition to the Steinberg-Padilla proposal. But senators have received statements of opposition from the California Chamber of Commerce, California Black Chamber of Commerce, the Black Chamber of Commerce of the San Fernando Valley, the Assn. for Los Angeles Deputy Sheriffs, the California Taxpayers Assn. and the Neighborhood Market Assn.

According to records and interviews, all of those groups have received donations from Altria Group Inc., which owns Philip Morris. "It's very deceptive," said Stanton Glantz, professor of medicine and director of the Center for Tobacco Control Research and Education at UC San Francisco. "The tobacco companies have a long history of giving money to groups representing businesses and ethnic minorities to buy their allegiance."

Reference: Lawmakers consider $1.50-per-pack cigarette tax hike Tobacco lobbyists have blocked previous attempts to increase the levy, one of the lowest in the country by Patrick McGreevy, Los Angeles Times, 5/25/2009.

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