![]() |
May 18, 2006
Take and giveIs the state taking money from smokers and getting ready to give it to homeowners? Somebody in the newsroom asked that question yesterday and it's a good one. There's not much doubt that 75 cent per pack health impact fee or tax is regressive. That means low income people pay more of it than high income people. A 1993 study I found on the internet (and don't believe everything you read on the internet) by KPMG Peat Marwick found that families making less than $30,000 per year pay more than half of all taxes paid on cigarettes. By contrast, it said families making more than $60,000 pay only 14 percent. Now that the Supreme Court has upheld the health impact fee, lawmakers are going ahead with plans for property tax relief. Technically the cigarette fee money goes to a different account that the property tax money, but the House was clear that it would not push ahead with its plan for property tax rebate checks if the fee had been struck down by the high court. MPR's Laura McCallum reports that the debate over tax relief now is between the House plan for pre-election checks and a Senate plan for more local government aid payments to various cities around Minnesota: Gov. Pawlenty says the House GOP rebate plan is a good short-term fix. And as for you smokers? You're on your own. Good luck kicking the habit. The Anoka County Vikings stadium appears done for the year. Senate conferees agreed to cut the Vikings loose from the stadium bill late Wednesday night. The move is good news for the Twins, but as MPR's Tom Scheck reports there are still a few details to be worked out: Now that the Vikings are out of the picture, the Twins are ever so close to getting a stadium plan through both bodies and onto the desk of a supportive Gov. Tim Pawlenty. The Twins ballpark plan would rely on a .15 percent sales tax in Hennepin County and a $130 million contribution from the team. The conference committee working on the Gopher football stadium met for the first time yesterday and members seemed optimistic they can get a deal done. Posted by Mike Mulcahy at 7:12 AMWhile you're pointing out the disproportionate amount of cigarette taxes paid by people with annual incomes of less than $30,000/year, why not also point out the disproportionate amount of health care costs attributed to smoking? Costs that are shared by smokers and nonsmokers alike in all income levels. Posted by Karl at May 18, 2006 9:01 AMI'm so happy to see the words 'regressive tax' here. I hope that we can talk about the distribution of Bachmann's plan repeal the graduated income tax and only tax the income we can't afford to save. But that discussion is best left for another time. There is data to suggest smokers actually cost less because they die sooner. The costs are not shared alike as he asserts because smokers pay higher insurance premiums. The MN department of revenue was kind enough to furnish me with a focused incidence study on the cigarette fee increase. According to their data, for households in the first decile (making less than $11,802), the cigarette fee increase is equivilent to a 1% income tax increase. For households in the tenth decile (making more than $125,140), it is equivilent to a .02% income tax increase. If Mike is interested in the table, I'd be more than happy to furnish it - just drop me an email. Posted by Justin C. Adams at May 18, 2006 10:58 AMAn Oligarchy that was influenced to the tune of 50 million dollars by "special interests" in the '05 legislature to influence legislation and an empty suited Governor backed up by a "political state supreme court" along with public funded anti smoking cartels continue to deal from the bottom of the "representative deck" without a whisper of opposition. The real danger is who or what will be put on the save us from ourself's hit list? It won't be smokers we have been tapped by 3.5 million dollars per week by the oligarchy. Posted by Archie Anderson at May 18, 2006 1:08 PMI can assure you that any increased premiums smokers may pay doesn't come close to covering the increased health costs caused by their stinking, dirty addiction. Nor does it even begin to address the health problems their secondhand smoke causes nonsmokers. But if you continue to advance the theory that because smokers die sooner, they "cost less," so that's a good thing, I would suggest that because they die sooner, they stop paying taxes sooner, and that's a bad thing. Posted by Karl at May 18, 2006 1:08 PMIt's true that smokers do increase health care costs. But isn't that what the massive tobacco settlement was supposed to pay for? Posted by Mike at May 18, 2006 1:19 PMWell, most people live a two-stage economic life - in the first part, they're productive, in the second part, they live off their savings and are not productive. So the taxpaying argument falls a little flat. But I wouldn't go so far as to say I'm advancing the theory - just that it has been suggested. And that was precicely what the tobacco settlement was to pay for. All that said, my chief complaint is that the tax is designed to create highly regressive revenue rather than to minimizing smoking. 75 cents is not an effective deterent. I was recently in Chicago, and let me tell you. 9 dollars a pack for Camels would be enough to make a lot of smokers quit. Just like 9 dollars a gallon would be enough to make a lot of driver quit. Which goes to what you say about second-hand smoke, but of course, it's hard to find a study of the impact of exhaust on people's health, too. Posted by Justin at May 19, 2006 6:53 AM |