TENN TAX BATTLE: SENATE PANEL REJECTS 30-CENT HIKE IN TENN CIGAREETE TAX (HOUSE VOTE UP NEXT)

NASHVILLE - The Senate Finance Committee on Tuesday rejected a proposed 30-cent increase in the state's cigarette tax, with members claiming the measure is a "piecemeal" approach to the state's budget problems. The panel's counterpart, the House Finance Committee, on Tuesday postponed until today a vote on a 1-cent sales tax increase that won approval from the full Senate Monday.

Sen. Rosalind Kurita (D-Clarksville), who proposed the tobacco tax increase to discourage smoking, said the committee's refusal to pass the measure showed that some members "are so concerned with passing an income tax that they will prevent any other revenue bill from passing. That is my opinion."

With the General Assembly locked in its fourth year of struggling over the state's financial mess, Kurita pointed out that the measure would raise an estimated $167 million for the state and is a tax that is well-accepted by voters. But when pushed to a vote, the bill received only five of the six committee votes needed for it to move to the full Senate floor.

"I generally support the concept of raising the tax on tobacco, but this should be brought as part of a larger package," said Sen. Jim Kyle (D-Memphis), who abstained from voting.

Kurita's bill would have raised Tennessee's tobacco tax to 43 cents per pack of cigarettes. Tennessee, whose current 13-cent-per-pack cigarette tax is the seventh-lowest in the country, is one of 20 states considering sharp increases in tobacco taxes this year. Under Tennessee law, 99 percent of tobacco tax proceeds are earmarked for K-12 education. Kentucky, West Virginia, Georgia and Missouri are among states considering tobacco tax increases, said Kurita, who is not a member of the finance committee.

"My motive is to try to prevent children from starting to smoke," said Kurita, a registered nurse. "Almost every state bordering us is considering or has passed an increase in cigarette taxes, so the cross-border purchasing of cigarettes is simply a non-issue."

Tennessee has the highest percentage of teen smokers in the nation, with 41 percent of teens using tobacco products, according to the federal Centers for Disease Control and Prevention. The CDC and the U.S. surgeon general have reported that many smokers - particularly those who are young or low-income - will quit or will smoke less in response to price increases.

Sen. John Ford (D-Memphis) voted against the measure, saying the tax would "just put the monkey on the back of those who can least afford it." Ford also challenged studies showing that increased tobacco prices result in lower smoking rates among young people.

On the Senate panel, Ford, Sen. Micheal Williams (R-Maynardville) and Sen. Robert Rochelle (D-Lebanon) voted no.

Sens. Kyle and Bill Clabough (R-Maryville) abstained, while Sens. Ben Atchley, Tim Burchett (R-Knoxville), Ward Crutchfield (D-Chattanooga), Joe Haynes (D-Nashville) and Henry voted for the tobacco tax increase.

In the House, action was delayed on the Senate-passed measure raising the state's sales tax by a penny from April 1 to June 30 - a measure that would raise $182 million to help make up the state's current-year budget shortfall of $350 million. Rep. Randy Rinks (D-Savannah), who sponsors the bill that was amended by the Senate on Monday night, delayed the measure's hearing until today.

Rinks refuses to carry or support any bill increasing the sales tax, and said he will let House Majority Leader Gene Davidson (D-Adams) take over the bill as sponsor.

On Tuesday, Gov. Don Sundquist told reporters he would not veto the three-month sales tax increase, but might let it become law without his signature.

The sales tax increase measure is scheduled to be heard in the House Finance Committee today, and could be put to a House floor vote as early as Thursday.

FROM MY EMAIL

Dear Senator Williams:

I endorse Jack's comments to you and add a very serious admonishment.

The constitution in very specific language denies you the power to enact a sales tax much less to increase one. It is not an insignificant fact that the state had no sales tax before 1947.

My argument is not a sophisticated one, nor does it require sophistication to simple men who can read plain unambiguous English. It is one which relies quite firmly on the clear text of the constitution.

Article II Section 30. "No article manufactured of the produce of this state, shall be taxed otherwise than to pay inspection fees."

In "Benedict v. Davidson County," 110 Tenn. 183, 67 SW. 806 (1901), a court ruled that "The terms 'produce of this state,' as used in this section [Article II Section 30], embrace whatever is produced or grown in the state, or is the yield of the state, whether it be crops or timber or coal or iron or marble or wood or any other article which may be treated as produced or grown within the state from or on the soil, or which may be found in the soil."

In "Nashville Tobacco Works v. City of Nashville", 149 Tenn. 551, 260 S.W. 449 (1923) the court ruled "This section contemplates things produced by nature and then converted by a process of manufacture into articles of merchandise and use. . . .Tobacco, converted into chewing tobacco, smoking tobacco, or snuff, like wheat ground into flour, is exempt from taxation under this section. . . Where articles' manufactured from the produce of the state are exempt from taxation under our taxing laws, such articles from another state would likewise be exempt, for the state cannot, in its taxing statutes, discriminate against the products of another state in favor of the products of its own citizens under the commerce and equal rights clause of the federal Constitution."

"This state cannot discriminate against property brought from another state, by imposing upon it a burden of taxation greater than that levied upon domestic property of a like nature, without directly burdening interstate commerce in violation of the federal Constitution (Art. 1, § 8). The imposition of a tax on lumber logs imported from another state into this state, and lying in the importer's mill yard in this state awaiting manufacture into lumber, or already manufactured into lumber and awaiting sale, which, if the produce of this state, would be exempt from taxation under this section, as held in the case of Benedict v. Davidson County, 110 Tenn. 183, 67 S.W. 806 (1901), operates as a discrimination against interstate commerce and as a direct burden upon it, and is, therefore, void as violative of the said interstate commerce clause of the Constitution of the United States." I.M. Darnell & Son Co. v. City of Memphis, 208 U.S. 113, 28 S. Ct. 247, 52 L. Ed. 413 (1908).

It could not be clearer for the text of the constitution and the rulings of courts are unambigous. Most items sold in the state are exempt from taxation except for an inspection fee.

The tax you contemplate increasing and subsequently voted to increase is not an inspection fee. It is a fee to generate revenue. It violates the letter and spirit of the constitution.

You once observed in one of your rare letters that you had little knowledge of the constitution, but relied on the AG to tell you what it means. This is malfeasance in office; an abrogation of your oath taken before God to support the constiution.

This is pathetic.

Constitutional law is for the benefit of the people, not for the pleasure of civil leaders. Constitutional law in a constitutional republic, not a democracy, protects the people from the plunder of elitists bent on establishing democratic welfare states.

It is noteworthy that when Jefferson read the 1796 Tennessee constitution, he observed that is was the most republican of any constitution yet written. Jefferson also noted "Free government is founded on jealousy, not in confidence; it is jealousy and not confidence which prescribes limited constitutions, to bind those we are obliged to trust with power. In questions of power, let no more be heard of confidence in man but bind him down from mischief by the chains of the Constitution."

You are bound by the chains of the constitution. You cannot wiggle out of these chains because of the greed of our incompetent leadership which has instigated the current spending boondoggle. Their arguments are meritless when compared to the high oath you have taken.

I strongly urge you to reconsider your position.

I withheld the man's name.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.