Higher Taxes Coming to Utah

October 9, 2008
Higher Taxes Coming to Utah
By: Dick Armey

Watch out, Utah! If a group of anti-smoking advocates has their way, Utah will soon have the sixth largest cigarette tax in the nation. The coalition wants to increase the current 69.5 cent per pack tax by $1.30 to a whopping $2.00 per pack. This would be the largest single cigarette tax increase in the nation and brings a pack of cigarettes to over $5.00. Regardless of whether you smoke or not, this is highway robbery.

Fans of the tax increase say that this would bring in revenue that would be spent on the increased health care costs smokers put on the system. However, a Vanderbilt University study found that "excise taxes on cigarettes equal or exceed the medical care costs associated with smoking" and estimated that the medical costs of smoking is only 23.6 cents a pack, nearly a third of the current Utah tax.

In addition to being based on a fallacy, the proposed tax hike is bad policy. Cigarette taxes are an unstable source of revenue, especially as higher prices force smokers to seek cigarettes through cheaper avenues like the black market and nearby states with lower taxes. Cigarette taxes are a regressive tax that punishes one small portion of the population and end up hitting small business owners who run convenience stores and gas stations the hardest.

Too often, cigarette tax hikes are an opportunity for lawmakers to try and raise revenue by going after a small group of taxpayers, making them cover an unshared portion of the tax burden without angering everyone else.

If politicians in Utah really want to improve the state's healthcare system, they need to remove the red tape, mandates, and big government regulations that keep the market from working in this industry.

Please Take Action and urge your lawmakers to focus on reform, not breaking new tax records.

Sincerely,

Dick Armey
Chairman
FreedomWorks
http://www.freedomworks.org