Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
SALT LAKE CITY
The tax on a pack of cigarettes would increase by about $1 under a bill passed by the Utah House.
The proposal by Rep. Paul Ray, R-Clearfield, would up the tobacco tax from 69.5 cents a pack to roughly $1.70. The average state tobacco tax is $1.34 per pack, according to the National Tobacco Cessation Collaborative.
Lawmakers on Tuesday voted 39-35 to send House Bill 196 to the Senate. A similar bill that nearly triples the tax was voted down in a Senate committee recently but could come back.
Gov. Gary Herbert has said he opposes any tax increases, but hasn't promised to veto any.
Ray said the hike would give those who smoke a reason to quit while providing the added benefit of generating $43 million in much-needed tax revenue.
"My intent in raising the tax all along is to get kids to stop smoking," Ray said.
He also said it could offset Utah's Medicaid costs linked to smoking-related illnesses. The Utah Department of Health says nearly 1,150 Utahns die every year because they smoke.
This is the third year in a row that Ray has proposed increasing the tax. A traditional aversion to hikes of any kind has stalled the bill in the past.
This year, the measure idled in the House for a few weeks but gained new lustre after a recent push to keep some programs from being cut under the 2011 budget.
Critics called the proposed tax a drain on an already frail economy. Some worried it would hurt small retailers, while others were skeptical about the long-term cash benefits.
"Just because lawmakers put it on paper doesn't mean the economy is going to cooperate," said Rep. Greg Hughes, R-Draper.
Rep. Michael Noel, R-Kanab, said it was unfair to single out smokers as a tax target.
"We look down on them, and that's unfortunate," Noel said. "We should try to help them, not try to tax them out of existence."
Ray's bill may have been voted out of existence without the holes in the budget that legislators are looking to fill.
Executive Appropriations Co-Chairman Ron Bigelow, R-West Valley City, told lawmakers Tuesday they're thinking about trying to scrape together an additional $121 million to save some programs on the chopping block.
It was during that meeting that Ray's bill was mentioned as a possible funding source.