Lawmakers should consider cigarette tax
Published 12:00 am Sunday, January 9, 2005
A state lottery, increases in sales taxes and a new $1 tax on a pack of cigarettes are among the possible ways Mississippi legislators may consider raising revenues for a budget well over projected state income.
Lotteries have been successful in many other states, including neighboring Louisiana and Tennessee. Are they the right way to raise money to pay for state services? That’s a question legislators likely will answer during the session that begins today in Jackson at the state capitol.
Many studies show the people most likely to buy lottery tickets are the ones least likely to have the extra money for the tickets. In other words, the lottery gamblers usually are middle- to lower-income residents, whose money is better spent on their families’ needs.
Increases in sales taxes also might put undue pressure on the budgets of the average Mississippi family unless care was taken to exempt those staple household foods and goods every family needs. Further, Gov. Haley Barbour has vowed to veto any tax increase. That vow likely would include the cigarette tax. Could he be won over?
A cigarette tax is not a new idea in Mississippi. The discussion has arisen before. This time, however, there may be more support than before. Further, there are other states who are trying the cigarette tax beginning this month, including Alaska and Colorado, and Mississippians might want to keep up with what happens in those states.
In Alaska, the new $1-per-pack tax begins with a 60-cent increase this month. In January 2006, the tax becomes 80 cents; and then in 2007, $1.
State Sen. Bob M. Dearing of Natchez said recently that he could support such a tax and that most of the constituents with whom he has spoken are in support of the cigarette tax.
A $1 increase in a pack of cigarettes could generate an annual $185 million, not nearly enough to match the shortfall expected for the $3.8 billion fiscal-year-2005 budget. But the extra cigarette tax money could make a difference in some of the programs facing cuts as the Legislature begins to slash state agencies’ appropriations. Medicaid alone is expected to need more than $268 million above what is already budgeted for the program.
We urge legislators to consider carefully the cigarette tax as one way to help in a year that will be fraught with tough choices and lines drawn &045; between Democrats and Republicans, senators and representatives, the governor and many others in state government. We urge all those involved
in making cuts and making budget to think of the greater good of all Mississippians as they make the difficult choices ahead.