Tobacco Tax Measure Draws High Spending
Phillip Morris USA and R.J. Reynolds Tobacco -- the two largest tobacco companies in the U.S. -- have poured more than $54 million into a campaign to defeat Proposition 86, the proposed state tobacco tax, the AP/Richmond Times-Dispatch reports.
Proposition 86 would increase the state tobacco tax by $2.60 per pack of cigarettes, raising the tax to the highest level in the nation. The average price of a pack of cigarettes would increase to $6.55.
The two companies have contributed $41 million more than the amount raised by proponents of Proposition 86. Reynolds has contributed $22.7 million thus far, while Phillip Morris has spent $31.9 million. The measure's biggest supporter, the California Association of Hospitals and Health Systems, has contributed $9.5 million.
If passed, the increased tax would raise about $2 billion a year for anti-smoking programs and other health initiatives. Proponents claim the increase would prompt 500,000 Californians to stop smoking (AP/Richmond Times-Dispatch, 10/14).
Proposition 86 would "hurt the state budget," David Henderson, a research fellow at the Hoover Institution at Stanford University, writes. According to Henderson, "a tax increase that large will reduce the number of taxed cigarette packs purchased, reducing the revenue collected from the current cigarette tax, which goes to the state budget."
Henderson writes that revenue from the measure is "earmarked for various special interests in health care and would fund health insurance for people under age 19 (including illegal immigrants)" (Henderson, Wall Street Journal, 10/14).
KPCC's "Patt Morrison" on Friday included a discussion of Proposition 86. Guests on the program included Wendy Lazarus, founder and co-president of the Children's Partnership and supporter of the measure, and Geoff Segal, director of government reform at the Reason Foundation and an opponent of the measure (Morrison, "Patt Morrison," KPCC, 10/13).
The complete segment is available online in RealPlayer.
In addition, KPCC's "KPCC News" on Thursday included an interview with reporter and author Marc Haefele about Proposition 86 (Jahad, "KPCC News," KPCC, 10/12).
The complete segment is available online in RealPlayer.