A listing of the state tobacco taxes for the eight states that border Missouri follows: Iowa $1.36; Nebraska $0.64; Kansas $0.79; Oklahoma $1.03; Arkansas $1.15; Tennessee $0.62; Kentucky $0.60; Illinois $0.98.
Official ballot language for Proposition B will read as follows:
“Shall Missouri law be amended to:
·Create the Health and Education Trust Fund with proceeds of a tax of $0.0365 per cigarette and 25% of the manufacturer’s invoice price for roll-your-own tobacco and 15% for other tobacco products;
·Use Fund proceeds to reduce and prevent tobacco use and for elementary, secondary, college, and university public school funding; and
·Increase the amount that certain tobacco product manufacturers must maintain in their escrow accounts, to pay judgments or settlements, before any funds in escrow can be refunded to the tobacco manufacturer and create bonding requirements for these manufacturers?
A “yes” vote will amend Missouri law to create the Health and Education Trust Fund with proceeds from the 73 cents increase on a pack of cigarettes. This will make the Missouri tobacco tax 90 cents on a pack of cigarettes. A “no” vote will result in no change to the current Missouri law and will leave the tobacco excise tax at 17 cents per pack.
If passed, the measure will increase taxes on cigarettes and other tobacco products, with estimated additional revenue to state government anywhere from $283 million to as much as $423 million annually. This revenue will fund only programs and services allowed by the proposal. The physical impact to local government is unknown.
Supporters of Missouri’s Proposition B believe that raising the tobacco tax will be one of the best ways to reduce the number of smokers and to prevent young people from ever starting to smoke. Furthermore, it is believed that smoking-related medical costs funded through Medicaid will decrease considerably. Currently, Medicaid expenses associated with tobacco-related diseases cost Missouri taxpayers an estimated $532 million annually. Each package of cigarettes sold in Missouri costs our state’s economy an estimated $12.68 in lost productivity and preventable healthcare expenses.
It is reported that nearly one out of every five deaths in Missouri can be attributed to tobacco. We are the fourth highest state in the nation in number of smokers, seventh highest in incidents of lung cancer, and eighth highest in number of deaths resulting from lung cancer. Tobacco is killing over 10,000 Missourians yearly at a rate of one Missourian every 50 seconds.
Opponents claim that any proposed tax increase will be detrimental at this time, especially given our present economic conditions.
Voters previously rejected proposed tobacco tax increases in 2002 and 2006. Both years the nation’s largest tobacco companies spent millions to oppose the increase. This time, however, these same companies are sitting it out. Big tobacco companies actually support Proposition B because it will reduce their competition with off-brand cigarette companies, and thereby eliminate the pricing advantage these smaller companies now have.
Opponents argue that if Proposition B passes, off-brand cigarettes could actually cost more that the name brands. This will be because of the 1998 tobacco tax settlement that required tobacco companies to contribute millions of dollars each year into Missouri’s Medicaid fund. Companies that have been created since the tobacco tax settlement fourteen years ago are excluded from this obligation, and this is why these off-brand cigarettes can be sold cheaper than the name brands. Proposition B would close this loophole.
Main opposition to Proposition B comes from Missouri Petroleum Marketers and the Convenience Store Association’s political action committee.