02/05/2009

Cigarette Tax Hike Proposal

Smokers' allegiances will be tested, though, when the federal government tacks on a 61 cent hike per pack very shortly.
"I understand the legislation is being helpful to the general population in terms of health care," noted Kirk Sparrow, "but as far as the smoker goes, this won't change my buying habits."
As early as next week, President Obama is expected to sign an expansion of federal health care legislation, known as SCHIP, that would provide coverage for an additional 4 million kids by upping the federal cigarette tax from 39 cents to a dollar.
One local tobacco shop employee fears the consequences.
"I believe will cigarettes, and fewer cigarettes too," sighed Slava Kirzhner, who works at Cigarette Warehouse in Richmond. "It will harm my business dramatically."
Richmond-based Altria, parent company to Phillip Morris, isn't thrilled about the legislation either. In a statement issued Friday, the company noted:
"Putting aside the obvious merits of the SCHIP program, we continue to believe funding any expanding federal program with a declining revenue source does not make sense. We will continue to oppose tax increases that unfairly target adult smokers."
Many within the industry do feel like they are being singled out.
"I believe that's discrimination," added Kirzhner. "This is not the industry to pick on."
The SCIP expansion bill passed the Senate Thursday night by a vote of 66 to 32. The House has already passed its own legislation, meaning the two bodies need to reconcile one bill before it can be signed by President Obama.

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