SUBSCRIBE to Capitol Fax      Advertise Here      Mobile Version     Exclusive Subscriber Content     Updated Posts    Contact
CapitolFax.com
To subscribe to Capitol Fax, click here.
A look at the governor’s cigarette tax hike plan

Monday, Apr 23, 2012

* The Sun-Times editorialized on behalf of the cigarette tax hike to help patch the state’s huge Medicaid funding hole

First, a tax on cigarettes will deter smoking. The American Cancer Society estimates the tax increase would stop 72,700 children in Illinois from becoming smokers and encourage 53,400 adults to quit. That’s no small accomplishment, given how terrible smoking is for our health.

Second, smoking-related health-care costs drive up Medi­caid spending, a fact Gov. Quinn emphasized when he met with the Sun-Times editorial board Friday. Smoking is estimated to cost the state $4.10 billion a year in health-care costs — and $1.5 billion of that tab is picked up by Medicaid.

“This is a very big public health measure,” Quinn said, “and anyone who is involved in public health is all for this.”

Third, trying to balance the state’s Medicaid budget with cuts alone means walking away from federal dollars. No other tax offers that huge federal match.

Fourth, Quinn already is proposing 58 stunningly deep Medicaid cuts. Further cuts would be devastating.

Fifth, the last three Republican governors of Illinois backed cigarette tax increases five times.

One significant quibble: Any tax hike or revenue increase or budget cut elsewhere could be used to leverage federal Medicaid dollars.

* The Tribune also backs it

All of this is necessary, but doesn’t reach $2.7 billion. Enter the $1-a-pack cigarette tax, which would generate an estimated $337.5 million. Because Washington matches each state dollar spent on Medicaid, the state’s gain would double, to $675 million. We support this hike for two reasons: Medicaid, which provides care for smoking-induced illnesses, needs the money; the American Cancer Society estimates that tobacco cost Illinois $1.5 billion in Medicaid spending last year. And making cigarettes costlier means many people will quit or never start.

And

We hope Democrats, including those beholden to unions, will build on Quinn’s plan. Just as we hope Republicans will do the same — and drop their opposition to including a cigarette tax hike in any Medicaid rescue.

For Illinois to escape its downward spiral, its politicians of both parties will need to abandon some of their customary talking points (”No benefit reduction,” “No tax hike”).

We take it as a real measure of leadership that Gov. Quinn — accepting his “rendezvous with reality” — is pressing the case for major Medicaid and pension reforms. Friday afternoon, meeting with our editorial board, he said that legislative agreement to rescue Medicaid and pensions “will make Illinois a whole lot better state.”

He’s right.

* A Paul Simon Public Policy Institute’s 2011 poll of southern Illinoisans showed a large majority supported the cigarette tax hike

While Southern Illinois voters remain adamantly opposed to raising major taxes to plug the state’s $15 billion budget deficit, they show some support for increasing the cigarette tax, according to the latest Southern Illinois Poll conducted by the Paul Simon Public Policy Institute at Southern Illinois University Carbondale.

The poll, taken Feb. 14-22, showed 60.3 percent of registered voters in the state’s southernmost 18 counties favor a $1 per pack increase in the cigarette tax. There were 36 percent opposed. The rest were undecided.

* And a statewide poll taken in 2010, at the height of Tea Party intensity, found that almost three quarters of Illinoisans backed the tax increase

A poll released Thursday by the Illinois Coalition Against Tobacco found that voters statewide supported raising the cigarette tax by $1 – from 98 cents per pack to $1.98.

Of the 502 people who were surveyed, 74 percent supported the increase. That total included 71 percent of Republicans, 81 percent of Democrats and 68 percent of independents.

Even 42 percent of smokers said they support a cigarette tax increase, the survey found.

Supporters said the tax increase was the best way to fix the state’s $13 billion budget deficit. Other options, including higher income taxes, higher sales taxes and higher vehicle registration fees, were largely opposed.

Interestingly enough, the Campaign for Tobacco-Free Kids estimated back in 2010 that the buck a pack tax hike would bring in “nearly $300 million each year.” Gov. Quinn estimates that his buck a pack tax hike would bring in well over $300 million a year.

* But the two GOP legislative leaders are opposed

“We stand with our members on the Medicaid working group against any tax increases to solve our Medicaid crisis,” noted Senate Minority Leader Christine Radogno and House Minority Leader Tom Cross. “We are encouraging the working group to continue working in a bipartisan way to come up with $2.7 billion in Medicaid reforms and cuts, not revenue enhancements.”

* Former Senate President Pate Philip, a conservative, anti-tax Republican, usually supported cigarette tax hikes, believing the impact was felt mainly by Democratic voters, which may be why some Democratic legislators are opposed.

“I’ve always been again against cigarette taxes,” said state Sen. Gary Forby, D-Benton. “My district likes to smoke. When you do a tax on this, they go over in Kentucky, they go over in Indiana and they buy them cheaper. They just quit spending money in the state of Illinois.”

Illinois has a very long border with a whole lot of states, which is probably the most logical reason to oppose a cigarette tax hike.

* Roundup…

* Components of Medicaid savings plan still open to change

* Finke: Quinn threatens no break until Medicaid deal

* Our View: Illinois’ health care, pension quandary

* Smokers Upset About Proposed Cigarette Tax Hike

* Illinois Medicaid cuts worry healthcare providers

* Local reps not excited by Quinn’s Medicaid plans - Republicans Moffitt, LaHood say targeting fraud, abuse more important

* McCaleb: Positive steps on Medicaid, pensions?

* Cancer Society supports higher Ill. tax on cigarettes

* Despite questions, Quinn’s Medicaid proposal winning some praise

- Posted by Rich Miller        


14 Comments
  1. - wordslinger - Monday, Apr 23, 12 @ 9:53 am:

    –First, a tax on cigarettes will deter smoking. The American Cancer Society estimates the tax increase would stop 72,700 children in Illinois from becoming smokers and encourage 53,400 adults to quit. –

    If that’s the case, I think Quinn has an opportunity to get Illinois employers that offer health insurance behind this tax increase.

    A lot of employers are starting to offer incentives/disincentives to get their employees to stop smoking to keep their health insurance premiums down. This would seem to be a no-cost initiative they could get behind.

    Full disclosure, I’m a long-time smoker and have never tried quitting.

    But I’m also someone who thinks marijuana should be legalized and taxed heavily. Can’t be a hypocrite about cigarettes.

    It would force smokers to pay more of their fair share for the true costs of their health care. Gee, where have I heard a similar idea, before?


  2. - Oberver - Monday, Apr 23, 12 @ 9:57 am:

    I have read now that some studies are showing that since smokers live less longer they incurr less costs than non smokers overall on medicaid. I wish I knew how to verify this independantly. However I have a different suggestion. I have seen some pretty obese individuals using the link card to buy food. Perhaps by somehow cutting back on the types or quantities of foods the obeity rate could be cut similarly cutting medicaid health care costs.


  3. - Colossus - Monday, Apr 23, 12 @ 9:57 am:

    100% agree with Wordslinger, as per usual.

    While it does seem that employers could get behind this idea, it would also make sense that employers could get behind a plan that would allow them to stop paying for their employee’s health insurance while still supplying them with a healthy workforce. Hmm…if only there were a plan like that, or maybe even a law…

    Businesses commenting on, supporting, writing and opposing laws rarely make sense to me these days.


  4. - Shore - Monday, Apr 23, 12 @ 10:10 am:

    I am in strong support even as a republican for tax increases on booze and cigarettes so this is fine with me.


  5. - John Bambenek - Monday, Apr 23, 12 @ 10:11 am:

    Wordslinger-

    You assume cig taxes will actually go to pay for the person’s increase Medicaid costs… which was also the assumption with the Railsplitter settlement money.

    It would be one thing to match health care premiums to actuarial risk… that might be economically defensible.

    That said, there are fewer and fewer smokers every year, which means tying a long-term non-discretionary program (Medicaid) to a consistently declining revenue source means we’ve overtly adopted unsustainable funding and will have to just go back and either introduce more cutes or add more revenue to make up the difference.


  6. - langhorne - Monday, Apr 23, 12 @ 10:51 am:

    doesnt anyone see the folly of increasing a consumption tax with the intent to reduce consumption, in order to fund programs whose costs we cant cover because they are rising so fast?

    the tax was increased from 58 cents per pack to 98 cents july 1,2002, about a 69% increase. but revenue increased only 33% in fy 03. revenue went up another 19% in fy 04, and has declined each year since.

    state cig revenue was $561 mil in fy 11 and quinn says a 100% increase in the tax will increase revenue $337 mil–60%!! the example of the last increase shows the estimate should be half that amount, or less.

    cigs are the only bootlegged product where the quality stays exactly the same. your rolex knockoff is crap, but the marlboros from another state are exactly the same.


  7. - Cheryl44 - Monday, Apr 23, 12 @ 11:06 am:

    As a former long time smoker, I think raising the tax is a good idea. I don’t think it will pay for what it’s supposed to, but anything that will help other people quit is a good idea.


  8. - haverford - Monday, Apr 23, 12 @ 12:01 pm:

    “cigs are the only bootlegged product where
    the quality stays exactly the same. your rolex
    knockoff is crap, but the marlboros from
    another state are exactly the same.”

    And thus the first Indiana jewelers’ libel lawsuit was born.


  9. - Robert - Monday, Apr 23, 12 @ 12:23 pm:

    ==doesnt anyone see the folly of increasing a consumption tax with the intent to reduce consumption, in order to fund programs whose costs we cant cover because they are rising so fast?==
    I see the folly and agree with your point. However, the alternative is even deeper cuts to Medicaid children and families, and the total amount of proposed cuts to Medicaid is already the largest part of the solution proposed.


  10. - wishbone - Monday, Apr 23, 12 @ 2:17 pm:

    Smoking is now mostly a class issue. Sorry, but it is a major indicator of your social class. Increasing a regressive tax on addicted members of that class to help pay for medical care to that same class seems unfair, but screw them. Unlike a lot of their problems this one is purely self inflicted.


  11. - wordslinger - Monday, Apr 23, 12 @ 4:59 pm:

    –Smoking is now mostly a class issue. Sorry, but it is a major indicator of your social class.–

    What class is that? And what are the classes here in the SOI and USA?

    I’m a smoker and a pretty classy guy, myself.


  12. - wishbone - Monday, Apr 23, 12 @ 6:28 pm:

    Wordslinger: You may not believe there are social classes in this country but, of course, they exist. Check out the percent of smokers by education level which is a primary indicator of social class. See
    http://www.cdc.gov/vitalsigns/AdultSmoking/index.html


  13. - BillA518 - Tuesday, Apr 24, 12 @ 8:46 am:

    This is such a bad idea for two reasons -
    1. The huge influx of cash will be spent on new projects that will become ‘essential’ in a couple of years…just about the time the revenue dries up due to decreased sales. (but isn’t that what they want?)
    2. Just like the multi-billion dollar tobacco settlement of years back, the claims are based on junk science and cherry-picked statistics. “the American Cancer Society estimates that tobacco cost Illinois $1.5 billion in Medicaid spending last year.” That’s true. What they don’t want you to know is that tobacco SAVED Medicare over $2 billion because people who have been paying into Medicare (and Social Security) for decades, died from tobacco-related illness before they were old enough to draw ANY benefits.


  14. - Rich Miller - Tuesday, Apr 24, 12 @ 9:02 am:

    ===The huge influx of cash will be spent on new projects ===

    Sez who?


Sorry, comments for this post are now closed.


* Ridiculous allegation withdrawn
* *** UPDATED x1 *** Question of the day
* Adventures in governing
* Rauner on Obama: "One of the most anti-business presidents we've had in the last 70 years"
* Callis recycles ad, reportedly lowers buys
* *** UPDATED x2 - Frerichs responds - Cross responds *** Frerichs says Cross is Rauner's "lapdog"
* Poll: Rauner leading by 6, Topinka up by 22, Cross up by 10
* Pumping up the base
* NRI head will testify next week
* *** UPDATED x2 *** Another day, another GTCR revelation
* Rate Rauner's three new TV ads
* SUBSCRIBERS ONLY - Supplement to today’s edition: Congressional crosstabs
* SUBSCRIBERS ONLY - Today's edition of Capitol Fax (use all CAPS in password)
* Good morning, everybody!
* Yesterday's blog posts

Support CapitolFax.com
Visit our advertisers...

...............

...............


Search This Blog...

Search the 98th General Assembly By Bill Number
(example: HB0001)

Search the 98th General Assembly By Keyword

          
        * Verizon Reverses Course on Plan to Throttle Unlimited LTE Customers
        * No, you’re not imagining that greatly improved Moto 360 battery life
        * Apple Updates 'Apple Store' App With iPhone 6 Support
        * Nexus 6 may have just been spotted in the wild
        * Fleksy arrives on Amazon, Samsung app stores, adds 2 languages
        * A New App Called Offtime Helps You Unplug Without Missing Out
        * iPhone 6 Plus review – Apple’s outstanding entry to the “phablet” market

        * The NFL’s Flirtation With the Web Is Over (For Now)
        * "That's How Knowledge Works: It Builds Up, Like Compound Interest"
        * Facebook engineers open source ‘cookbooks’ for Chef framework
        * Here's What Windows 10 Looks and Feels Like
        * Most Popular Gift Registry Site: CheckedTwice
        * Manager or Leader? The Great Ones are Both
        * Target Date for Box IPO Slides Again

        * Guide to American League rooting interests for White Sox fans
        * Anderson, Edwards prospects to watch in AFL
        * Manager notes: How Robin Ventura and Chris Sale get along
        * Voting underway to decide Hank Aaron Awards
        * Development of young core in '15 can define Chicago's future
        * Improved White Sox take important step in 2014
        * September call-ups report card: position players


        Main Menu
        Home
        Illinois
        YouTube
        Pundit rankings
        Obama
        Subscriber Content
        Durbin
        Burris
        Blagojevich Trial
        Advertising
        Updated Posts
        Polls

        Archives
        October 2014
        September 2014
        August 2014
        July 2014
        June 2014
        May 2014
        April 2014
        March 2014
        February 2014
        January 2014
        December 2013
        November 2013
        October 2013
        September 2013
        August 2013
        July 2013
        June 2013
        May 2013
        April 2013
        March 2013
        February 2013
        January 2013
        December 2012
        November 2012
        October 2012
        September 2012
        August 2012
        July 2012
        June 2012
        May 2012
        April 2012
        March 2012
        February 2012
        January 2012
        December 2011
        November 2011
        October 2011
        September 2011
        August 2011
        July 2011
        June 2011
        May 2011
        April 2011
        March 2011
        February 2011
        January 2011
        December 2010
        November 2010
        October 2010
        September 2010
        August 2010
        July 2010
        June 2010
        May 2010
        April 2010
        March 2010
        February 2010
        January 2010
        December 2009
        November 2009
        October 2009
        September 2009
        August 2009
        July 2009
        June 2009
        May 2009
        April 2009
        March 2009
        February 2009
        January 2009
        December 2008
        November 2008
        October 2008
        September 2008
        August 2008
        July 2008
        June 2008
        May 2008
        April 2008
        March 2008
        February 2008
        January 2008
        December 2007
        November 2007
        October 2007
        September 2007
        August 2007
        July 2007
        June 2007
        May 2007
        April 2007
        March 2007
        February 2007
        January 2007
        December 2006
        November 2006
        October 2006
        September 2006
        August 2006
        July 2006
        June 2006
        May 2006
        April 2006
        March 2006
        February 2006
        January 2006
        December 2005
        April 2005
        March 2005
        February 2005
        January 2005
        December 2004
        November 2004
        October 2004

        Blog*Spot Archives
        November 2005
        October 2005
        September 2005
        August 2005
        July 2005
        June 2005
        May 2005

        Syndication

        RSS Feed 2.0
        Comments RSS 2.0
        WordPress

        Loading


        * Emanuel won't rule out fee hikes in 2015 budget.....
        * New ad urges women to 'Say yes to Bruce Rauner'.....
        * Gov. Quinn Proclaims “First Ladies Health Day” .....
        * McAuliffe to campaign for Gov. Pat Quinn in Chi.....
        * Dining Out for Equality helps fund work of Equa.....
        * Rauner: Claims in new Quinn ad 'false and misle.....


        * Judge: Suspect in SIU threats should be released
        * Professor who lost U of I offer plans speeches
        * Donations drying up for Lincoln library foundation
        * Governor candidates' views on Obama library evolve
        * Person in custody after Carpentersville stabbing
        * Ex-Chicago police commander getting out of prison
        * IDOC: No need to review rules on convict contact
        * Community prosecutor to serve East St. Louis area
        * U of Chicago increases aid to needy students
        * Officer accused of taking drug from evidence room

        * Donations drying up for Lincoln Presidential Library foundation, chairman tells lawmakers
        * ALPLM at center of legislative hearing in Chicago
        * Former head of anti-violence program to testify
        * Appellate court: State workers owed back wages
        * Quinn leans on top Democratic support — Obamas, Clinton
        * IDOC investigation prompts state prison warden to retire
        * Lawmaker panel plans to resume anti-violence program investigation
        * Quinn touts first year of Affordable Care Act
        * State-owned airplanes to be sold in online auction
        * GOP opposition to school funding bill irks Manar

        * The world's elite colleges: Where Northwestern and U of C stand
        * Secret Service Director Julia Pierson resigns
        * United stock dips on news of first U.S. Ebola case
        * Chicago-Indianapolis train getting snacks, surfing and biz class
        * Young drinkers have abandoned big beer. Can it be saved?


        * Let’s get a grip on Ebola fear in U.S.
        * Video shows Rauner opposing Medicaid expansion last year
        * Rauner’s biggest strength proving to be greatest weakness: Mihalopoulos
        * CPS students with good GPA could get free ride to City Colleges
        * Union: CPS was warned that janitor job cuts could cause problems
        * Lawyer: Key witness to answer questions from panel probing NRI
        * Emanuel super PAC rakes in $2.4 million since late June
        * Pedicab operators say city rules putting brakes on their business
        * IHSA to boycott legislative hearing set for Friday in Chicago
        * Quinn urges City Council to tighten reins on small digital signs


        * Man charged in 2009 slaying of girlfriend found in Little Calumet River
        * 'Not guilty' verdict in Naperville 'smart meter' case
        * Worker with gun arrested at Elgin water treatment plant: 'He had a bad day'
        * Minor injuries in pepper spray incident at West Side school
        * Emanuel won't rule out fee hikes in 2015 budget
        * 'No loan' pledge aims to make U. of C. more affordable
        * Registered sex offender charged with attacking woman at Brown Line stop
        * CPS grads can qualify for new city college scholarships
        * Rauner, Quinn clash on Obamacare expansion ahead of president's Chicago visit
        * Cops: Man with symptoms of dementia missing from Humboldt Park


        * LLCC Announces New Ag Programs
        * Tim Landis: Bike Lanes, Medical Marijuana And Meat
        * Clock Ticking On Illinois Prison Crowding
        * Decatur Unemployment Shows Biggest Drop In Nation
        * Quinn Lauds Affordable Care Act, Backs Down From State Marketplace
        * A Redo On Redistricting
        * Polls Showing Illinois Governor's Race A Draw
        * Bruce Rauner, Before He Was A Candidate (Author Interview)
        * Listen to State Week - September 19, 2014
        * Clearing The Air On Clean Air Plan


        * Donations drying up for Lincoln Presidential Library foundation, chairman tells lawmakers
        * Former head of anti-violence program to testify
        * Michael Gerson: Two cheers for Obama, not three
        * Appellate court: State workers owed back wages
        * Quinn leans on top Democratic support — Obamas, Clinton
        * IDOC investigation prompts state prison warden to retire
        * Panel plans to resume anti-violence program probe
        * Lawmaker panel plans to resume anti-violence program investigation
        * Quinn touts first year of Affordable Care Act
        * State-owned airplanes to be sold in online auction


        * Area Girls' Golf Tournament-Lake of the Woods
        * SWIC's Manufacturing Day open house set for Friday
        * Three craft workshops set for fall semester at RLC
        * Alpha Phi Alpha Fraternity president to visit with local nonprofit
        * The never ending adventure
        * Police: Madison County man, suspect lucky to be alive after wild battle over guns
        * Dubois to host fall festival
        * Mission partners with food bank in annual holiday drive
        * Run supports Make-A-Wish Iowa
        * Boil order lifted for part of Murphysboro


        * Secret Service chief resigns amid security lapses
        * Glen Ellyn's McChesney & Miller set to close Saturday
        * No injuries in accident involving two state troopers on I-355
        * Man in custody after gun reported at water district building in Elgin
        * Driver in fatal Highland Park 'huffing' crash must report to prison

        * Representative Jan Schakowsky Sends Letter...
        * Rep. candidate pushes to uphold marriage b...
        * Reps. Schakowsky and Waxman Introduce Bill...
        * Statement by Representative Jan Schakowsky...
        * FAA Rejects Call For New O'Hare Noise Stud...
        * Representatives Quigley, Duckworth, Schako...
        * Representative Jan Schakowsky Statement on...
        * Representative Jan Schakowsky Statement in...
        * U.S. House Passes Resolution Condemning An...
        * Representative Jan Schakowsky Statement on...

        * Northeastern Illinois University celebrate......
        * Northeastern Illinois University celebrate......
        * Northeastern Illinois University celebrate......
        * Northeastern Illinois University celebrate......
        * Northeastern Illinois University celebrate......

        * Israel On The Outs Over Iran?...
        * On The Campaign Trail, GOP Gov. Snyder Hig......

        * Nuns on the Bus rally 1
        * Report: U.S. Temp Work At Record High, More Protections Needed For Workers
        * Illinois won't reveal amount it spends on college tuition for government workers
        * College Republicans release pro-Rauner parody ad [video]
        * Kirk and ILGOP congressmen call on Obama to investigate Quinn's use of federal funds
        * Update x1: College Republicans release pro-Rauner parody ad [video]
        * Chicago Alderman Calls For Higher Fines For Impersonating A City Worker
        * October is National Cyber Security Awareness Month
        * Protect yourself from cyber criminals by attending this free webinar
        * U.S. Secret Service Director Resigns


        * Screwed Up
        * Jobs Governor
        * Wake Up
        * Rauner Launches Three New TV Ads
        * Quinn must take lame duck tax vote off the table




            Hosted by MCS SUBSCRIBE to Capitol Fax Advertise Here Mobile Version Contact Rich Miller