A slimmed-down bid to raise Utah's tobacco tax was beaten back in a Senate committee Thursday as opponents cited fears of forcing smokers out of state to buy cigarettes and concerns about damaging the economy.
Sen. Allen Christensen, R-North Ogden, initially had proposed raising the 69.5-cent-a-pack cigarette tax to $2, but ran into resistance and lowered the boost to $1.30, the national average for nontobacco-producing states.
"Tobacco kills people. It costs this state billions of dollars in the process of killing these people," Christensen said. "Tobacco companies, excuse me, but just don't give a damn about this state, its citizens, its finances or its children."
Michael Siler, the government affairs director for the Utah chapter of the American Cancer Society, said the tax increase would motivate an estimated 27,000 people to quit, deter children from starting, and save millions on health-treatment costs.
But senators voted 4-3 against the bill, objecting to targeting one group of people and fearing smokers would go elsewhere to buy cigarettes.
"This seems to be a very regressive tax, because people of the lowest income seem to be the ones who are hooked on it," said Sen. Howard Stephenson, R-Draper, president of the business-backed Utah Taxpayers Association. "It will increase cross-border sales of Utah economic activity.. . . I don't think it's going to have the kind of effect we would like."
Gary Klc, owner of Jeanie's Smoke Shop in Salt Lake City, said his customers have told him that if the state raises the tobacco tax, they will drive to Idaho.
"We haven't decreased the smoking in Utah," Klc said. "We've decreased the sale of tobacco in Utah" and the money from the tax.
Jim Olsen, president of the Utah Retailers Association, said that after the state raised the tax in 1997, a study found that cigarette sales in the county that includes Evanston, Wyo., shot up by 23 percent.
Sen. Curt Bramble, R-Provo, who was considered a key swing vote on the bill, said he "in no way supports the use of tobacco." Bramble said his father is dying of emphysema as a result of his smoking habit, but he believes it is bad tax policy and he objected to revenues from the tax being dedicated to cessation and health programs.
A bill, sponsored by Rep. Paul Ray, R-Clearfield, and identical to Christensen's original proposal of a $2-per-pack tax, has yet to come up for debate in the House. Ray has expressed confidence that there will be a cigarette-tax increase this year, but is not sure how much it will be and where the money will be spent.
The federal government recently raised its 39-cent tobacco tax to $1, with the proceeds going to fund the Children's Health Insurance Program. Thirteen other states have tax increases proposed, including Washington, which is considering raising its tax to $3.25.
Gov. Jon Huntsman Jr. had proposed a $3-per-pack tax, but has backed away from that figure. Christensen said the governor supported the $1.30-per-pack rate.
