WASHINGTON – Even before President Obama officially proposed a federal
cigarette tax increase to fund preschool programs, many tobacco companies and
sellers were already lined up against it.
Obama’s
2014 budget proposal, released April 10, would finance a pre-kindergarten
program for 4-year-olds with higher taxes on cigarettes and other tobacco
products. The president outlined the program in his annual State of the Union speech.
White House spokesman Jay Carney declined to elaborate on the proposed
tobacco-tax increase. “Wait for specifics,” he told reporters at a briefing — but
the tobacco industry didn’t wait.
“The idea of increasing taxes on low- to middle-income Americans at this
time is ludicrous,” said Bryan Hatchell, a spokesman for Reynolds-American. “As
middle-income Americans struggle to make ends meet in a very slow economic
recovery period, this is not the time to hit them with higher taxes.”
“It is unfair to single out adult tobacco consumers with another federal
tobacco-tax increase to pay for a broad, new government-spending program,” said
David Sutton, a spokesman for Altria.
Convenience stores would also be hurt as higher taxes curb consumer
spending, including tobacco purchases that account for 40% of non-gasoline
sales for those retailers, said Jeff Lenard, vice president of industry
advocacy for NACS. “It is not just the loss of sales, but also the loss of
customers,” he said.
However, anti-smoking organizations praised Obama’s proposal. “A
significant tobacco-tax increase is a win-win-win for the country — a health
win that will reduce tobacco use and save lives, a financial win that will
raise revenue to fund an important initiative and reduce tobacco-related
health-care costs, and a political win that is popular with voters,” said
Matthew Myers, president of the Campaign for Tobacco-Free Kids in Washington.