Posted on 07/14/2011 8:20:26 AM PDT by bigbob
As states around the country continue to face ongoing projected budget deficits, many elected officials are advocating consumption tax hikes in an effort to close budget holes (see Dayton, Mark and Democrats, Minnesota). However, New Hampshire recently cut its cigarette tax in a move to increase revenue and now Michiganthe state generally regarded as having the worst economy in the countrymay follow suit.
Senate Bill 517 would roll back the $2 per pack cigarette excise tax, among the highest in the nation, and reset it at $1 per pack. It would be partnered with budget cuts including an option that would tighten up Medicaid restrictions, loosened by the previous Democratic administration.
As with New Hampshire, experts believe the move could enable Michigan to become more competitive vis a vis neighboring states with higher cigarette taxes, encouraging consumers to purchase their cigarettes within the state rather than elsewhere. In addition, the move could reduce the attractiveness of smuggled cigarettes illegally sold without tax being levied. Studies by the Mackinac Center for Public Policy have estimated that nearly 35 percent of all cigarettes consumed within the state were purchased outside its borders, in Indiana, Ohio and even Kentucky. The estimated tax-induced smuggling in Michigan, which increased steadily as the taxes on cigarettes also increased, was a hefty 16 percent, the fifth highest in the nation.
Of course, passage of SB 517 would also be a decisive victory for personal freedom, as the rollback bills champion has made clear:
It is largely a philosophical belief that the government thinks that the consumption of alcohol and tobacco is so bad, but government is so addicted to the revenue, he said.
I wasnt elected to protect whats in government coffers. I was elected to protect whats in the pocketbook of my constituents and the people I serve, he added.
However, given concerns over the state budget, it is likely that fellow legislators will be more intrigued by the revenue-enhancing effects of the proposed cut, especially in the wake of media attention that New Hampshires reduction has received.
I'm not a fan of smoking, but I'm a huge fan of Freedom!
But I thought we were increasing the taxes to protect the children. /sarc
That would do so much for small business.
Call me crazy but the time is ripe for conservatives to come to Michigan and help us build on our momentum.
It isn’t for the faint of heart but the long term payoff could be awesome.
We should be thinking of what other punitive, stupid, liberty-restricting taxes have been put in place to try to help the states kick the can down the road, and press our law-makers to roll them back as part of a true spending-reduction and reform process.
I think many of them have already pissed away their share of the big tobacco settlement money on pork, entitlements, and things having nothing to do with convincing people not to smoke.
The great lakes drilling ban should be lifted.
Its supporters (Thanks again Fred Upton) claimed that side drilling from shore would contaminate the lakes. Meanwhile Michigan sits on top of a massive natural gas reserve.
Nice idea, but reference the “Free State Project” of the libertarians. NH is still pretty left, afaik. NH is also in FAR better shape both finanacially and infrastructure-wise, with a lot fewer urbanites.
Smokers warned the powers that be that constantly raising the tax was going to lead to this point, but gov’ts and anti-smoking Gnatzis (thanx Gabz) “knew better”, thinking that smokers wouldn’t find ways around the taxes, including quitting outright. It looks like the demonized weren’t kidding, doesn’t it?
I’m a quitter, btw. There are a couple of shots floating around the interweb that show me smoking, but they are over 5 years old. When a local “administrative body” (unelected super-council) put a tax on smokes that went up every 6 months automatically on top of the provincial and federal taxes that did the same, I said “Enough!” I was a minimum 1 1/2 packs a day guy, too.
I used to keep a carton in the freezer, two packs in the glovebox, and two packs in my locker at work. One night I ran out of smokes, so I went to the locker, nothing, the glovvie, nothing, so I decided then and there to drop the habit, and it’s stuck ever since.
I’m not calling for the free staters.
Conservative retirees would be a good place to start but they would still need to find means to protect their money from taxation while they vote for more favorable taxation and policies.
We have a great deal of pent up potential in Michigan. As I’ve mentioned we have the Antrim gas formation, unbeatable hunting and fishing, good solid conservatives outside the cities. Very important is the fact that we have a few “tipping point” congressional districts that can be moved to the right or moved from RINO to conservative.
Surprising because Michigan’s neighbors (Wisconsin, Ohio, Canada) also tax the heck out of cigarettes. This seems more an issue wherever a high tax state borders a low tax one.
The great lakes drilling ban should be lifted.
Its supporters (Thanks again Fred Upton) claimed that side drilling from shore would contaminate the lakes. Meanwhile Michigan sits on top of a massive natural gas reserve.
Last time I checked the Canadians were aggressively drilling on their side. I suppose there is some big rubber barrier out there which will keep any sort of pollution generated in Canadian territorial waters?
Note to the ‘Rats: So much for principle, eh?
Good for you on stopping. I have always and will always be supportive of those who choose to stop smoking - as long as they don’t turn into gnatzies!!!!
I live just a few miles south of the Maryland/Virginia line. The number of out of state plates I see at the various cigarette “outlets” on a daily basis is unbelievable.
Nanny State PING!
Thanks for the ping!
~snaps fingers~ Hey, I just thought of something. You could make a fortune buying cigarettes in VA and selling them in MD. Better hurry before somebody else gets wise to this!
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