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Press Coverage

Coalition seeks to fund health programs by raising cigarette tax

San Francisco Chronicle
December 14, 2005
By Jennifer Coleman

A coalition of health organizations wants to nearly quadruple the tax on a pack of cigarettes in California to boost funding for hospital emergency care, nursing education, cancer research and a variety of other health programs.

The per-pack tax would jump by $2.60 under an initiative the coalition hopes to have on the November 2006 ballot, supporters said Tuesday. If voters approve the proposal, California's total tax on a pack of cigarettes would rise to $3.47, the highest in the nation.

The initiative combines two competing tobacco tax measures that had been in circulation.

One campaign was led by the California Hospital Association and would have added a $1 tax, while the other was spearheaded by the American Cancer Society would have raised $1.50 per pack.

The new campaign includes those organizations, plus the American Lung Association of California, California Emergency Nurses Association, American Heart Association, Children Now, the California Association of Physician Groups, the Campaign for Tobacco Free Kids, among others.

Revenue from the extra tax would be directed to various health programs, including cancer screening, prevention and research, low-cost children's insurance, and tobacco education and cessation. Supporters also hope it will provide more money for emergency care and clinics.

Because the extra per-pack tax would be expected to curb sales, the initiative also allots $159 million a year to offset any loss of revenue to Proposition 10 programs. Proposition 10, approved by voters in 2004, added a tax of 50 cents per pack to fund early childhood education.

The initiative also would give money to local law enforcement to enforce tobacco control laws, which critics said would be needed to offset an expected rise in black-market cigarettes.

Raising the tax by such a large amount might lead some people to quit smoking, said Craig Fishel, spokesman for North Carolina-based R.J. Reynolds Tobacco Co.

"But more likely what you have is people looking for other means to get their cigarettes, usually from other states or on Indian reservations where excise taxes aren't enforced," he said.

The increased revenue that the initiative's supporters are touting also will be short-lived, said Larry McCarthy, president of the California Taxpayers Association, an anti-tax group.

If people can't afford to smoke, they'll quit or buy illegal cigarettes, reducing the amount of taxes collected, he said.

"It's very ill-advised. It will do nothing but damage to the tax structure and is not going to lead to higher levels of health care services," McCarthy said.

The tax is projected to raise $2.7 billion annually if cigarette sales remain at the current level, but the higher price is expected to cut sales by about 8 percent a year, supporters said.

Having fewer smokers, especially among young people, is one of the proposal's goals, said Paul Knepprath, vice president of the American Lung Association of California.

"We know that increasing the price of cigarettes is one of the most efficient ways to stop kids from smoking," he said.

He said most adult smokers started when they were under 18.