Public health advocates are dismayed that for the second year in a row, a hike in the state's cigarette tax has been proposed and failed.
A tax increase, they say, would be among the most effective ways of lowering the state's high smoking rate and improving its dismal heath ranking. “We've been putting so much emphasis on our structural infrastructure,” said Monique French, chairwoman of Tobacco Free Indiana. “We need to put the same amount of focus on our human infrastructure here.”
The advocates are correct. Higher costs for tobacco products would encourage some adult smokers to quit and, even more important, discourage many young people from starting in the first place.
Other states are coming to this point of view more quickly than Indiana.
Indiana has the 12th highest smoking rate in the nation among states, reports The Associated Press. Seven of the 11 states with higher smoking rates have increased their cigarette tax more recently than Indiana. Even West Virginia's similarly conservative Legislature raised its cigarette tax rate by 65 cents last year, bringing the total tax per pack to $1.20.
The original bill by Republican Rep. Cindy Kirchhofer contained a cigarette tax increase of $1.50 per pack — and passed a House public health committee on a 11-0 vote — that would have brought in an estimated $406.9 million in fiscal year 2018, rising to $435.5 million the following year. When it was reduced to a $1 increase, the nonpartisan Legislative Services Agency projected revenue would amount to $278.3 million, before rising to nearly $300 million.
The House passed a tax increase last year, too, but it was disliked by Gov. Mike Pence and killed in the Senate. This year, the culprits are the Senate and Gov. Eric Holcomb.
“My feeling is, if you don't need a tax, don't enact it,” Senate Appropriations Committee Chairman Luke Kenley said.
And Senate President Pro Tem David Long said that “for advocates it's a health issue — that's why they support it. But the reason we're talking about it is it is a budgetary issue — it's a source of revenue.”
Health advocates must acknowledge that reality. The primary purpose of a tax is never to direct public behavior. If that can be accomplished as a subsidiary goal, fine. But Long and Kenley are right: Any tax proposal is first and foremost a budgetary issue, and must work in that context.