Tobacco tax to renew insurance for poor kids
Increase cigarette tax to pay for children’s healthcare. 7/27/07
This issue is relevant to tobacco in that the mechanism being proposed to pay for this is via an increase in the federal tax per pack of cigarettes (which has remained at 39 cents for over 5 years). Despite bipartisan support for this legislation and the funding mechanism, President Bush continues to say that he will veto the bill. However, such a veto could be over-ruled if the majority in favor is of sufficient size.
The bill proposes to add 61 cents to the federal cigarette tax, taking it to $1-00 per pack. This would have a substantial effect of reducing cigarette consumption and motivating many more smokers to try to quit. The effect would be particularly potent on young people who are more price sensitive. The net effect would be a significant reduction in future healthcare costs via a reduction in smoking caused illnesses. Lack of health insurance is one of the major public health problems in the United States and improving coverage for children from poor families is a sensible way to remedy a small part of that problem. Fully funding the SCHIP legislation via tobacco tax increases is an excellent policy that would significantly improve health and healthcare in the United States. Failure to pass this legislation will once again be doing a favor to big tobacco companies, this time at the expense of sick kids without health insurance.