Raise Alabama's cigarette tax

Nothing good can be said about cigarettes, except perhaps that smokers pay a little more than the rest of us toward the cost of state and local government in Alabama. Now a couple of lawmakers would like them to pay more.
That's an excellent idea, especially since the state General Fund is expected to come up short by at least $400 million when fiscal 2013 begins next Oct. 1. The General Fund is the budget that provides the money for state troopers, Medicaid, mental health, prisons, the courts and a number of other agencies like state parks. (Cities and counties add their own taxes; Huntsville adds 10 cents a pack, and Madison Count, 3 cents.)
Rep. Patricia Todd, D-Birmingham, has filed a bill that would raise the state cigarette tax by 32.5 cents to 75 cents a pack, The Birmingham News' David White reported. That would raise an estimated $75 million a year for the General Fund.
Rep. Joe Hubbard, D-Montgomery, has filed a bill to raise the tax by $1 a pack, which would be earmarked for the state's Medicaid program for poor and disabled Alabamians. According to the Legislative Fiscal Office, the $1 increase would bring in about $230 million a year.
Chances for either to win approval appear slim. Todd has pushed cigarette tax increases for several years without success. But she told White she thinks the odds are better this year because the General Fund is in such poor shape. This year's $1.77 billion budget faces the loss of one dollar out of every five next year.
Todd was unable to persuade the Legislature to pass the tax for several years when Democrats were in control. Republicans took over in the November 2010 general election, and their leaders doubt the Legislature would increase in the tax.
And Gov. Robert Bentley has said he will not seek any tax increases. He has been thinking about cutting earmarked money for classroom teachers out of the state school budget to help the General Fund, even though the school budget is already under serious siege.
Marshaling his arguments, Hubbard told White that increasing cigarette taxes would be fair because some of Medicaid's money is used to treat the self-inflicted illnesses caused by smoking. "This is not an unfair tax," he said. "It is a tax on the people who engage in activity that costs every taxpayer."
A counter-argument is made by David Sutton, a spokesman for cigarette maker Philip Morris USA. "You're talking about a tax increase on one segment of the population to provide funding to the General Fund, which benefits the entire population of the state," he told White. "That's an issue of taxing equity."
But it isn't fair for all Alabamians to pay increased health insurance premiums to cover the cost of smokers' doctor and hospital bills. The American Lung Association estimates that more than one in five Alabamians smokes.
Think about the extra cost of caring for Medicaid babies in neonatal intensive care units who were born prematurely and underweight because their mothers smoked cigarettes. Out of more than 6,900 births to all mothers in Alabama in 2009, 11 out of 100 were smokers, according to the state Department of Public Health.
Some people argue against such an increase, saying it would expand cigarette bootlegging from border states where the taxes are lower. But people wouldn't have to pay a tax increase or any tax at all if they quit smoking. Of course, many of them would have a terrifically hard time doing that because they are physiologically addicted smokers, another endearing quality of cigarettes.
To be sure, cigarette smoking in the state is on the decline. For fiscal 2010, the state tax brought in $131.4 million from tobacco sales, a drop of about $17 million over four years, according to the state Department of Revenue. So a tax increase would not provide a stable source of money, but it would bring in dollars the state would not get otherwise for essential public services.
And a significantly higher tax can be expected to discourage a few people from taking up smoking or encourage them to cut back or quit before it kills them.
That's where a tax increase would really begin to pay off.