Cigarettes and Tobacco News

Jan 6, 2007 -- While being a step in the right direction, Gov. Mark Sanford's proposal for a token increase in South Carolina's cigarette tax is a dollar short and a day late. In the halls of government there is a sore lack of understanding of health care in general and a gross underestimation of the impact of our state having the lowest cigarette tax in the nation.

The governor's proposal to raise the cigarette tax to 37 cents is more than a dollar short of the $1.41 state tax per pack recently passed by President Bush's home state of Texas. The national average state cigarette tax is now a dollar.

In our state, the smoking-caused health care costs for Medicaid and Medicare are about $7 per pack of cigarettes sold. The federal tax on a pack of cigarettes is 39 cents, and our current state tax is just 7 cents. So for each pack sold we are presently getting 46 cents to fund the $7 of taxpayer expense for smoking-caused Medicaid and Medicare costs. Why would our governor propose a 30-cent remedy to a $6.50 problem? To say he is a dollar short is an understatement. Remember the figure above does not include the smoking-related health care costs of the uninsured. The best way to get out of a hole is to stop digging.

South Carolina has not raised the tax on a pack of cigarettes since 1977. The governor's idea is not a day late - it is actually three decades late. We are paying dearly for our lack of action, abroad and at home.

In 2002, a terrorist cell in North Carolina was convicted of selling $7.9 million of cheap N.C. cigarettes in Michigan by the tractor-trailer load, raising millions of dollars for the Hezbollah militia. According to federal law enforcement officials, the simple scheme of trafficking cigarettes is difficult to stop. The traffickers purchase a large volume of cigarettes in states where the tax is low, then transport them to high-tax states and sell them at a discount without paying the higher cigarette taxes in those states. This illegal practice has begun to rival drug trafficking as a funding choice for terrorist groups. A smuggler can make up to $2 million on a single truckload of cigarettes. A truckload contains 800 cases, or 48,000 cartons. Our low cigarette tax makes it much easier for these organizations to exploit the health and wealth of our state and nation.

Closer to home, why would we allow our children to become addicted to the most common and preventable cause of disease and death for 30 years and then come up with a ill-conceived plan to give an income tax break to S.C. residents instead of using the funds to remedy our state's health care crisis? The cigarette tax should be a fair user fee for those who choose to smoke and not place a burden on those who make the healthy choice of not smoking.

The governor's own appointed Health Care Task Force recommended, back in 2003, increasing the cigarette tax and using it as a renewable source of funding for our state's Medicaid insurance program; by doing so, the federal government will match every state tax dollar with three federal tax dollars. We could then fully fund the Children's Health Insurance Program, a federal initiative to cover more indigent children under Medicaid. At present, one in five children in our state does not have health insurance while the national average is one in nine. By failing to fully fund the CHIP program, we are simply allowing our federal tax dollars to care for other states' children instead of our own.

Health care problems don't go away when a child does not have health insurance - in fact, they often get worse and more expensive. It costs each of us when a child is unable to attend school because of illness or a parent has to miss work to care for a sick child.

Increasing our cigarette tax, at least to the national average, is common sense public policy. It is the most effective deterrent to youth smoking, it reduces health care costs, and saves lives here and abroad while generating revenue for our failing health care delivery system. A 2006 voter survey showed that more than

70 percent of S.C. voters are in favor of a dollar tax on each pack of cigarettes. As our legislative year begins, let your voice be heard.