Raising The Cigarette Tax: Is it Viable In Missouri?
Jefferson City, Mo. – Missouri lawmakers this year made deep cuts to the state budget that takes effect next month. They had to slash money for many social services and for various education programs, including Parents as Teachers and Career Ladder. Governor Jay Nixon has indicated he may slice up to $350 million more when he signs the budget into law. Fellow Democrats have proposed ways to keep the budget-cutting knife out of Nixon's hand by enhancing revenue. One common suggestion is raising Missouri's cigarette tax. But, that's not as easy as it sounds.
At 17 cents a pack, Missouri's cigarette tax became the lowest in the nation last month when South Carolina raised its tax on cigarettes. Holding the line on taxes has been one of the few things that Democratic Governor Jay Nixon and the GOP-led General Assembly have agreed on during the past two legislative sessions. And that includes so-called "sin" taxes on cigarettes, alcohol, and the like.
At a recent stop in St. Louis, Nixon expressed his opposition to raising the state's cigarette tax.
"Missouri voters have twice rejected that in recent years," said Nixon. "There may be a time in which some groups want to push that forward, and if so, it'd be interesting to look at."
But the governor indicated that's not likely to happen any time soon. A few House Democrats tried this year to persuade the majority to consider raising the cigarette tax. For the past two years, Jamilah Nasheed of St. Louis has sponsored legislation to boost it from 17 to 33 cents a pack.
"The first year, it got a hearing," said Nasheed. "And the second time that I sponsored the bill, they didn't even refer (it) to the committee...and for some reason, I don't know."
During the final days of session, fellow Democrat Mary Wynne Still of Columbia pushed for a cigarette tax hike by adding it onto a separate bill as an amendment. Her measure would have raised the tax by 12 cents a pack.
"It helps us with Medicaid and medical expenses for everyone," Still says. "It helps keep insurance rates down lower if fewer people are smoking...if you raise the cigarette tax, fewer people smoke."
But Still never got the chance to present her amendment, as she was not recognized by the acting Speaker of the House the day before session ended.
Proposals to raise any tax in Missouri have to withstand the scrutiny of the Hancock Amendment to the state constitution, which includes a provision requiring voter approval of tax hikes. And as Nixon noted, Missouri voters have rejected two attempts in the past decade to raise the cigarette tax.
Republican House Speaker Pro-tem Bryan Pratt cites that as reason enough to leave the state's cigarette tax alone.
"If it increases revenue by a certain amount, and that changes every year with the Hancock Amendment, it would have to go to a vote of the people," says Pratt.
But Nasheed contends her proposal would not have required a statewide vote.
"If the increase on taxes for tobacco is at $90 million, then that's below the Hancock Amendment," says Nasheed. "And so if that being the case, we don't have to take it to a vote of the people."
The one unknown factor will be the influx of new lawmakers who will replace those leaving this year because of term limits. Will they be more open to raising the cigarette tax?
Marvin Overby is a political science professor at the University of Missouri, Columbia.
"I think it's probably more likely in a non-election year than an election year," says Overby. "And I believe that there is some evidence that that is the trend."
But there's no guarantee that 2011 will be any different than 2010. Overby suggests lawmakers who are subject to term limits may tend to focus more on the next election.
"With a term-limited legislature, where they're all looking potentially to move up to other offices, that might limit the willingness of Republican legislators from wanting to take that risk of being associated with any sort of tax hike, even if it's a sin tax, like on cigarettes," says Overby.
As for Governor Nixon, Overby says the first-term Democrat has learned from the actions taken by former Governor Bob Holden, who raised taxes and failed to get re-elected. Nixon is expected to seek a second term as governor in 2012.