ANNAPOLIS – Anti-smoking activists and legislators are backing a bill that would increase Maryland’s cigarette tax by $1 per pack, in an effort to curb smoking and fund an expansion of health care to the state’s uninsured.
“We know as a fact that if you increase the cigarette tax by a dollar per pack, thousands of Maryland children will not smoke,” said Vincent DeMarco, president of Maryland Health Care for All! Coalition. “Maybe up to 50,000, and a third of them would have died horrible deaths.”
Speaking in a meeting of the House Health and Government Operations Committee, DeMarco said revenue from the tax increase would also fund healthcare for up to 50,000 low-income workers who are currently uninsured.
But representatives of the tobacco industry said saddling smokers with Maryland’s healthcare costs was “inappropriate and unjust.”
“We’re not talking about a tax being imposed on a company or a corporation,” said Dennis C. McCoy, a lobbyist for the Altria Corporation, formerly Philip Morris, “but rather a tax that’s going to be imposed on approximately 18 percent of the population . . . and then used to address what really is a societal issue.”
The bill, sponsored by Delegate Sheila E. Hixson, D – Montgomery, would increase the tax for a typical pack of 20 cigarettes from $1 to $2. The legislation would also raise the tax rates for other tobacco products, including cigars.
McCoy questioned whether the tax increase would discourage Marylanders from smoking, or simply discourage them from buying cigarettes from businesses in the state.
“In today’s Internet world, when the cost of cigarettes increases because of taxes, what happens is people buy them from Indian reservations or buy them over the Internet or cross the border and buy them in another state,” McCoy said.
Supporters of the bill disputed this claim, pointing to a state Bureau of Revenue Estimates study conducted after the 2002 tobacco tax increase that did not find a clear correlation between the cigarette tax rate and state tobacco sales.
However, the study did note an increase in cross-border cigarette sales and cautioned that the data supported “few conclusions.”
Virginia currently has a tobacco tax rate of 30 cents per pack of cigarettes.
Legislators have already increased Maryland’s tobacco tax rate twice in the past seven years. In 1999, the tax was raised from 36 to 66 cents per pack, then to the current rate of $1 per pack in 2002. Currently, a pack of cigarettes typically costs between $3 and $5 retail.
Not all businesses that sell tobacco products oppose the proposed tax increase.
Barry Scher, vice president of public affairs for Giant supermarkets, called the legislation “a good bill” that would lower health care costs by reducing the number of smokers.
“Why is a company like us supporting a tax increase? The overall benefit will be lower health care costs for all businesses, large and small,” Scher said.
Still, cigar shop employees are worried about the effect the legislation might have on their businesses.
“A lot of people are going to lose their jobs and that’s the reality of it,” said Travis Zepp, manager of the Westminster Cigar Company. “Whether or not you personally approve of the service or the goods that we provide, I guess it is what it is, and it’s our livelihood,” Zepp said.