Thursday, April 25, 2002

Smoker may be Ohio's savior

Extra 50 cents/pack would go to budget hole

By Dan Klepal,
The Cincinnati Enquirer

        The cost of a smoke may go up in an effort to close Ohio's $1.2 billion budget deficit.

        Gov. Bob Taft, in Blue Ash on Wednesday for a regional cabinet meeting at Raymond Walters College, said he supports a 50-cent tax increase on cigarettes, being considered by legislators.

[photo] Gov. Bob Taft speaks Wednesday at Raymond Walters College in Blue Ash about the state's budget deficit.
(Ernest Coleman photo)
| ZOOM |
        The state now imposes a 24-cent tax on a pack of cigarettes.

        A majority of Senate Republicans has tentatively agreed to the cigarette tax increase. Details of the Senate's budget plan will be released today. The GOP controls the Senate 21-12. The Republican-controlled House also would have to approve the tax increase.

        A 50-cent increase would raise $372.9 million next year, according to Teri Geiger, chief of staff for the Ohio Senate.

        Tripling the tax would place Ohio among states with the highest taxes on cigarettes — New York ($1.11), Hawaii ($1), California (87 cents), Washington (82.5 cents), New Jersey (80 cents), Wisconsin (77 cents) and Maine (74 cents).

        Kentucky, with a 3-cent state tax, is the second-lowest in the country, ahead of Virginia (2.5 cents).

        Mr. Taft said a final decision on the tax will come soon, so that any new legislation could be enacted by June 1, in time for the next fiscal-year budget.

        He said he is working closely with Senate President Richard Finan, R-Evendale.

        “We're working with legislative leaders on how to close the budget,” Mr. Taft said. “We're looking at belt tightening, conservative spending and ways to increase sources of revenue.”

        Ms. Geiger said the estimate on additional revenue from the tax increase considers what many studies have shown — people smoke less when the cost of cigarettes goes up.

        “We are focused on the budget shortfall and there are no easy ways to fill the gap,” Ms. Geiger said. “Sen. Finan thinks this is one option well worth considering.”

        GOP senators Kevin Coughlin of Cuyahoga Falls, Jim Jordan of Urbana and Scott Nein of Middletown oppose the tax plan. All support further reductions in state spending and all oppose raising taxes.

        Doug White of Manchester, the Senate's No. 2 Republican and a Southern Ohio tobacco farmer, wants the plan to restore $32 million to Ohio tobacco farmers taken from the state's settlement with major tobacco companies.

        If that money is restored, Mr. White said, he would be neutral on the cigarette tax increase.

       The Associated Press contributed.


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