Seven bills target tobacco in short session

Seven bills would deal with North Carolina's signature crop.

The ones most likely to pass deal with where you can smoke.

One bill would prohibit smoking in state and local government buildings. Another bill would outlaw smoking in state-owned vehicles. A third bill is both more discretionary and more expansive, allowing community colleges to prohibit all tobacco products โ€” including chew โ€” on campus.

All three have multiple sponsors and companion bills.

A House bill, meantime, would study whether smoking should be prohibited in foster care homes.

Two other House bills would affect Big Tobacco's bottom line, but the odds area against them.

One bill would increase the state cigarette tax 75 cents per pack โ€” far above Gov. Mike Easley's proposed 20-cent hike and in line with an anti-smoking campaign's push. Another bill would repeal manufacturing tax credits related to exported cigarettes.

Neither has a companion in the Senate.

Only one piece of legislation is relatively friendly to the tobacco industry, and that's not saying much.

That bill, filed by Burlington Republican Rep. Cary Allred, would allow school districts to choose whether to go tobacco-free, essentially undoing an Aug. 1 mandate created by a 2007 bill.

But the bill is not likely to go far any time soon, although it passed a first reading. It has only one sponsor, and there is no companion bill in the Senate.

Alliance: Raise cigarette tax more

The N.C. Alliance for Health says 20 cents is not enough.

The nonprofit coalition of health care associations argues that Gov. Mike Easley's proposed increase in the cigarette tax from 35 to 55 cents a pack will not stop people from smoking.

In a press release, the group argues that tax increases of 20 cents per pack or less "provide no significant smoking reductions" or related savings in health care costs.

Instead, using the slogan "75 Saves Lives!," it argues that the state should raise the tax 75 cents.

The group argues that would preent nearly 95,000 pre-teens and teen-agers from starting to smoke while causing a 16 percent decrease in youth smoking. It would also raise $347 million, as opposed to the $111.4 million the lower increase would generate.

North Carolina currently as the seventh-lowest cigarette tax in the country. The tax has been raised only three times in the past 17 years, and legislators are skeptical about the latest proposal.

The history of the cigarette tax

The state cigarette tax has gone up only three times in the past 17 years.

According to research by the N.C. Department of Revenue, the state's cigarette excise tax increased from 2 cents a pack to 5 cents a pack on Aug. 1, 1991.

It increased to 30 cents a pack effective Sept. 1, 2005.

And it increased again to 35 cents a pack effective July 1, 2006.

Those last two increases occurred during Gov. Mike Easley's watch. Easley has proposed raising the cigarette tax another time to 55 cents a pack in his 2008-09 budget in order to pay for raises for public school teachers.

The state currently has the seventh-lowest cigarette tax in the country.

Cigarette taxes frequently targeted

Cigarette taxes have become a popular source of state revenue.

According to research by the Campaign for Tobacco-Free Kids, 43 states, the District of Columbia and several U.S. territories have increased their cigarette tax rates more than 75 times since 2002, when many states faced tight budgets due to the recession.

Arturo Perez, a fiscal analyst with the National Conference of State Legislatures, said the tax has been targeted for several reasons: It is considered more voluntary than other taxes, smoking is considered unhealthy, and some groups believe the tax would cut smoking rates.

"It is a tax that is now viewed as something that is more palatable to voters," he said.

Perez said that the cigarette tax is the most frequently targeted of so-called "sin taxes" on junk food, alcohol and tobacco. In many cases, he said it is directed to anti-smoking programs and health care.

Gov. Mike Easley's proposed budget calls for increasing the state cigarette tax from 35 to 55 cents per pack. It is currently the seventh-lowest in the country.

N.C. has seventh-lowest cigarette tax

North Carolina has the seventh-lowest cigarette tax in the U.S.

The state's current 35-cent per pack excise tax on cigarettes is higher only than six other states, including border states of South Carolina and Virginia, as of Jan. 1, 2008, according to research by the Federation of Tax Administrators.

South Carolina's seven-cent rate is the lowest in the country, while Virginia's is closer, at 30 cents. Georgia levies 37 cents per pack; Tennessee, 62 cents.

The highest rate is New Jersey, at $2.57 and a half-cent per pack. The national median is $1 a pack, the rate in the District of Columbia, while the average for all 50 states and D.C. is $1.11.

In next year's budget, Gov. Mike Easley proposed raising the cigarette tax from 35 to 55 cents per pack to pay for public school teacher raises that would average 7 percent.

At 55 cents, North Carolina would be tied with West Virginia for the 12th-lowest cigarette tax in the country.

Cigarettes, booze for teachers, mental health

Gov. Mike Easley proposed a $21.5 billion budget Monday that would raise taxes on cigarettes and alcohol to help pay for teacher raises and mental health reform.

Easley's budget, a 4.2 percent increase from the previous year, would add a 4 percent tax to beer and wine and a 4 percent tax to liquor to pay for a $68 million fix to the state's failing mental health system.

Easley would raise the tax on cigarettes from 35 cents to 55 cents per pack to pay for public school teacher raises that would average 7 percent. Administrators would receive a 6 percent raise.

This is Easley's last budget proposal. He is prohibited by law from seeking a third term. He has said a major goal of his last year is to get teacher pay up to the national average.

Pay increases would be given at a higher rate for newer teachers, said Dan Gerlach, a senior budget advisor to Easley.

"We all have to keep in mind this is a salary that is going to have to continue to grow if we want a quality education across the nation," Easley told reporters Monday morning.

More after the jump.

Taxes up, smoking down

State public health officials said this morning that cigarette sales have dropped in the first year since North Carolina increased the cigarette tax.

And yet tax revenues from cigarettes continued to grow, they said.

"This means fewer North Carolinians and their families will face illness, disability and early death," said Dr. Leah Devlin, the state's health director. "The increased tax has improved the health of both the state's people and its coffers."

State officials said there was an 18.5 percent drop in cigarette sales in the first year of the tax hike. But they said tax revenues from cigarettes grew by $157 million.

The tax was increased from five cents a pack to 30 cents on Sept. 1, 2005, and then an additional five cents was added on July 1, 2006. That brings the state's tax to 35 cents a pack, still well below the national average of $1.07 a pack.

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