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There seems to be growing momentum in the capitol for raising Florida's 34-cent cigarette tax as one way to deal with the state's deepening finanical crisis -- but a new estimate indicates smokes might not provide the budget boost once envisioned.
A $1 hike in the state cigarette tax -- to $1.34 per pack -- is now expected to bring in $700 million in extra revenues, said Amy Baker, the Legislature's chief economist. That's down sharply from last spring's estimate that put the expected windfall to state coffers at $1 billion.
"People change their spending habits" in a recession, Baker said. "They might have bought some name brands or some sort of deluxe version of cigarettes before, but now they're going to basics, the generic cigarettes."
Even at 34 cents a pack, state revenues from cigarette taxes are declining.
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The Florida tobacco tax currently is 34 cents a pack, which doesn't sound like much, but don't let that deceive you. Smokers also pay a 39 cent federal tax, along with a hidden tax disguised as exorbitant prices. The steep cost of cigarettes is the result of legal settlements with tobacco companies that brought billions of dollars into state coffers.
The alleged goal of tobacco lawsuits a decade ago was to win reimbursement for the money states paid out in smoking-related medical costs. Along the way, the lawsuits turned some multimillionaire attorneys into mega-multimillionaires, as state attorneys generals worked in cahoots with private law firms. . . .
The state-initiated lawsuits represented possibly the biggest transfer of wealth from the poor to the rich since the days of Louis XVI and Marie Antoinette, and look what happened to them.
There are several interests that would cheer an increase in Florida's tobacco tax. Among them are the Seminole and Miccosukee tribes, which would see their sales of tax-free cigarettes rise appreciably.
Organized crime also would benefit. Cigarette smuggling already is a problem. Years ago, a New York official says it was more profitable to hijack a truck loaded with cigarettes than a Brink's truck.
Given these tough economic times, don't add to the burden of police, or to the financial burdens of the state's tobacco addicts, by raising the cigarette tax.
As reported here, House Speaker Ray Sansom and Senate President Jeff Atwater on Tuesday officially released their call for the special budget-cutting session set to start next week and it closely mirrors the trust fund raids and cuts Gov. Charlie Crist had recommended.
Of particular note: It says higher cigarette taxes are off the table, but . . .
Lawmakers could also consider "making minor adjustments to existing user fees," but not "any fees related to alcoholic beverages, cigarettes, or tobacco products."
A family has been running the C.J. Newman Cigar Factory and is determined to keep on rolling.
For 36 years, C.J. Sjoblom has been making her own cigars at the Tampa factory and driving 160 miles a day to do it.
It's the only cigar company left in the United States that's still owned by the founding family.
While workers around country are losing their jobs every day and factories closing, the 100 employees here are not a bit worried.
"It was something their daddy wished to never end. They are keeping it going for him, and for us," said Sjoblom.
Re: "'Sin Taxes' May Get A Boost" [Nov. 30, front page], this dire fiscal crisis does present an opportunity for our state to recommit to fighting tobacco use. The source of revenue that we desperately need can be found by raising the cigarette tax by $1 per pack, which will raise nearly $1 billion annually.
The District of Columbia and 43 states have raised their cigarette tax rates more than 75 times since January 2002, more than doubling the national average cigarette tax from $0.43 to $1.14 per pack. . . .
The dangers of smoking and its toll on lives are not new, yet 4,000 kids still try their first cigarette every day.
However, every 10 percent increase in the price of cigarettes reduces youth smoking by about 7 percent, and overall cigarette consumption by about 4 percent.
The $1 increase is a simple way to offset the annual cost of treating sick smokers, and a highly effective way to reduce the number of kids who start.
Big Tobacco appears more ready than ever to accept a higher tax on cigarettes that would raise Florida smokers' costs by up to $1 a pack. But there's a catch -- in return, it wants lawmakers' help fending off a rising competitor from Opa-locka that makes dirt-cheap smokes.
Manufacturer Dosal Tobacco has seized about 14 percent of the state cigarette market with its 305's brand, which cost roughly a third less than some of its better-known rivals.
Big tobacco firms like Philip Morris USA say Dosal Tobacco has an unfair business advantage because, unlike them, Dosal doesn't have to pay settlement fees in Florida's landmark $11.3 billion tobacco settlement over deceptive marketing and the cost of treating sick smokers with Medicaid money.
The big companies have passed on the fees to their customers, about 50 cents a pack. That's in addition to Florida's 33.9-cent cigarette tax that smokers, including Dosal's customers, pay.
Ten years ago this month marks the anniversary of the death of former Florida governor, and my father, Lawton Chiles. While he will long be remembered for many things, the issue closest to his heart was the health and well-being of Florida's children. . . .
By closing tax loopholes and identifying potential funding sources, like a $1 tobacco tax -- which many groups have been promoting -- the state could raise over $1 billion to support our children.
My father recognized that making children a priority was critical to our future as a state and as a country. Our state is facing an unprecedented budget crisis. But that is no excuse not to do what's right for our children. We need to make smarter investments for children now. If we fail to invest wisely in our children now, we will pay more later on -- in police, in prosecution, in prison and remediation of all kinds.
Levying a one-cent tax increase on cigarettes is a much better and more suitable source for funds. Heck, make it two cents! By doing that, you may even improve Floridians' lives by encouraging smokers to cut down or quit smoking!
So please do something that will benefit your state while you raise the necessary cash to remedy whatever budgeting errors made this crisis occur. Don't fix one mistake by making another!
Several Florida lawyers who won the state's landmark 1997 tobacco settlement have agreed to try to block Gov. Charlie Crist and lawmakers from raiding the endowment fund named after the late Gov. Lawton Chiles.
This week, Tampa lawyer Steve Yerrid sent a letter to the eight remaining members of the legal team still living in Florida, asking them to put the "dream team" back together to keep lawmakers from dipping into the Lawton Chiles Endowment Fund to help offset a huge state budget shortfall.
Chiles, who died shortly before he was to leave office in 1998, launched the legal battle to ban Big Tobacco from advertising cigarettes and recoup medical costs for treating sick smokers.
The $1.4 billion Chiles endowment fund pays for roughly $55 million in children's health initiatives annually. Crist and lawmakers are considering ways to plug a $2.3 billion current-year budget hole, including potentially draining as much as $1 billion from the endowment. That could happen in a special legislative session in the capital to start Jan. 5.
"Those people need to know we got some folks that are serious about this," Yerrid said Thursday. "I want everyone to know there are still some folks around who remember."
Liberally slipping campaign contributions to Florida politicians, the tobacco industry continues to throw up a self-serving smokescreen.
This year, four companies gave a total of $482,200 to state legislative candidates and Florida's Republican and Democratic parties. That doesn't count the $24,000 from Miller Brewing Co. and $40,500 from Kraft Food, both owned by Phillip Morris. . . .
And what has Big Tobacco gotten in return? Exactly what it wanted: nothing -- as is no increase in this state's cigarette tax. While 45 other states were raising their levies during the past 18 years, Florida's stayed stuck at 34 cents per pack (less than one-third the national average).
"Through campaign contributions and lobbying, the tobacco companies, together with their subsidiaries and allies, have worked to create an environment that is favorable to tobacco interests," declared a 2003 study by Florida Common Cause. . . .
Florida House and Senate Democrats, along with the American Lung Association and the American Cancer Society, are again proposing a $1 increase in the state's cigarette tax. Gov. Charlie Crist has said he is "not warm and fuzzy" about the prospect, calling it a burden on Floridians during tough times. But other leading Republicans, including incoming Senate President Jeff Atwater, R-North Palm Beach, haven't ruled out the idea.
Political smokescreens notwithstanding, raising the cigarette tax is the right call. Florida's public health and welfare demand nothing less.
As Florida struggles with massive budget problems, smokers could pay part of the price.
Some lawmakers and health groups are trying to build pressure to increase cigarette taxes by $1 a pack -- a move they say could bring in an additional $1 billion a year for the financially strapped state, while also helping prevent young people from smoking.
"It's a win-win for everybody," said Sen. Nan Rich, D-Weston, a key Democrat on health care issues.
The proposal, however, could touch off a political battle during the coming months. . . .
Some lawmakers think the state should increase its cigarette tax by $1 a pack. Here are some reasons for and against the idea:
WHY WE SHOULD: At just under 34 cents a pack, Florida's cigarette tax is among the lowest in the country. The increase could help pay for health programs in a lean budget year. And it might keep some cash-strapped kids from getting addicted.
WHY WE SHOULDN'T: Many lawmakers don't like any tax increase, particularly in a bad economy. Retailers and tobacco companies fear a tax increase could reduce sales or drive smokers to cheaper brands.
I read in your paper that the geniuses in our Legislature want to slap a $1 tax on each pack of cigarettes to help close their budget gap. Five cents a cigarette to fund their social welfare programs. Who is that going to impact the most? I don't smoke, but a lot of my lower-paid employees do. Let's put a $1 tax on each golf ball sold in Florida. You can't go more than a mile or two without passing one of those golf courses that are exempt from the water-usage regulations
A federal appeals court has upheld the conviction of a Florida man for selling counterfeit Cuban cigars under trademarks registered in the United States after Fidel Castro took power.
Juan Jose Penton claimed he did nothing illegal because his shop sold replica "Cuban" brands taken over when Castro nationalized cigar manufacturers in 1960. The Cuban trademarks are not recognized in this country, but the names are also owned by companies registered here.
A jury convicted Penton of violating the Trademark Counterfeiting Act
A fire Monday morning at a garage at 1659 40th St. resulted from a discarded cigarette, West Palm Beach Fire-Rescue Assistant Chief Kevin Green said today.
Firefighters found smoke and flames when they arrived at the house. They had the fire under control in about 20 minutes.
As a healthcare professional and Chief Operating Officer of the American Lung Association of Florida, I have been advocating at our state capital for years to increase the cigarette excise tax by one dollar. Many of us have heard the arguments to increase the tax, which is currently the fourth lowest in the nation. It will generate about $1 billion in new net revenue, save nearly 100,000 Floridians from smoking-related deaths, help 123,600 adults quit smoking and prevent 209,000 youth from ever starting. But what many people do not hear about is the extreme financial burden smoking causes our state, a burden we are unable to handle with the current fiscal situation, and one that can be alleviated, albeit not eradicated, by increasing the tax. . . .
It is time we demand smokers contribute more to the public burden of their deadly habit. It is time we make a change that will stop our youth from starting to smoke. It is time we find the best way to save lives and generate much-needed revenue for our state. Contact your legislators and ask they vote to increase the cigarette tax by one dollar.