Tax: USA Federal Tax Alert Page 4
Federal Tax Alert
Beware letting CDC director become food cop
J. Justin Wilson
June 6th, 2009
President Barack Obama’s first 100 days saw more than their share of mini-scandals involving tax return errors and other problems for some Cabinet nominees. But the one recent nominee that should have come under greater fire is New York City Health Commissioner Dr. Thomas Frieden, who will begin his new job this week as director of the Centers for Disease Control and Prevention.
As the architect of New York City’s smoking ban, cooking-oil crackdown, menu labeling mandate and five-year plan to reduce salt consumption, Frieden has clearly earned his nickname as the city’s “health czar.” But the trouble goes beyond Frieden’s record of culinary party pooping. The new CDC director is assuming his post at a watershed moment for U.S. public health policy.
Since modern medicine freed us from killers like typhoid and smallpox, addressing lifestyle choices has been rising to the top of America’s health agenda. At the CDC, those gears were set in motion long ago. (Congress added the words “and Prevention” to the agency’s name in 1992.)
Frieden’s blueprint for disease prevention involves food bans, sin taxes, mandatory recipe requirements and other command-and-control measures that have a punitive aspect that doesn’t belong in public health policy. Punishing junk food junkies by taking their snacks away, altering their recipes or taxing them into submission is profoundly intrusive, arrogant and likely ineffective.
For instance, the National Weight Control Registry collects the success stories of people who have lost at least 30 pounds and kept the weight off for a minimum of one year. Its co-founder, Dr. James Hill, is one of many experts to dismiss the good-food vs. bad-food approach to health: “We focus too much on diet and not enough on physical activity.”
State obesity statistics support this conclusion. Of the top 10 most-obese states, including Michigan, government surveys show nine of them are also the most sedentary. The residents of the most obese state, Mississippi, report the lowest rates of leisure-time physical activity in the country.
The way to encourage healthier lifestyles isn’t an iron fist. It’s a velvet work glove. Or a batting glove. Anything to get our bodies moving again, which is the only way to cure what ails us as a nation. And it’s education. It’s positive incentives.
The likelihood that Frieden’s restrictive policies could backfire — a problem that Department of Agriculture’s Economic Research Service highlighted in a 2005 report on menu abeling and snack taxes — suggests that the carrot, not the stick, may be our best option. Dietary needs vary widely enough that a heavy-handed government approach could be dangerous. (Several epidemiologists have taken issue with Frieden’s salt enforcement scheme, noting that the scientific support for sodium interventions is shaky at best.)
Promoting the notion that consumers aren’t responsible for their own choices — a natural outgrowth of government making the “right” choices for us — is a recipe for disaster. Even more alarming is Frieden’s apparent sense of duty to assume that national responsibility personally. He famously told the Financial Times in 2006 that “when anyone dies at an early age from a preventable cause in New York City, it’s my fault.”
By focusing on maximizing life expectancy (its “quantity”), Frieden ignores the “quality” side of the lifestyle equation. And many Americans are inclined to accept the tiny health trade-offs associated with perfectly legal lifestyle choices that give them pleasure. People who are more concerned with being happy than with living an extra month at age 90 shouldn’t be shushed by government officials who want to assume more responsibility for their health.
Do Americans really share Frieden’s ambition to prevent every disease at any cost? The doc’s killjoy reputation strongly suggests that the answer is “no.”
J. Justin Wilson is the senior research analyst at the Center for Consumer Freedom, a nonprofit coalition supported by restaurants, food companies and consumers to promote personal responsibility and protect consumer choices. E-mail comments to email@example.com.
Nanny-state stance seen in health chief
May 23, 2009
IT IS unfortunate that President Obama has chosen to put the nation’s health in the hands of an overzealous activist who doesn’t seem to give any consideration to the importance of personal responsibility or privacy (“Obama selecting N.Y. official to lead CDC,” Page A8, May 15). Dr. Thomas Frieden, New York City health commissioner, famously told the Financial Times that “when anyone dies at an early age from a preventable cause in New York City, it’s my fault.” What constitutes a “preventable cause” for Obama’s pick to lead the Centers for Disease Control and Prevention? Essentially any behavior that he personally disapproves of, including: eating salty or fatty foods, “insufficient” breast-feeding, and using birth control that isn’t city-approved. Following his myriad regulations in New York City, the New York Post quipped that Frieden had turned the city into “a nanny state on steroids.”
Frieden doesn’t simply blur the line between what is the government’s responsibility in regulating health and what is the individual’s responsibility; he barely recognizes its existence.
J. Justin Wilson
Senior research analyst
Center for Consumer Freedom
Outlook hazy for smoking rates in the USA
April 25th, 2009
By Eliza Barclay
The economic downturn has caused US smoking rates to increase for the first time in the past decade. Can a recent hike in cigarette taxes counteract the effect? Eliza Barclay reports.
On April 1, the federal cigarette tax in the USA increased by the largest amount in history from US$0•39 to $1•01 per pack to help pay for the expansion of a federal health insurance programme. Public health advocates (and pharmaceutical companies that manufacture quitting aids) are hoping that the price increase combined with the recession will deliver a deep blow to smoking habits as more people are forced to quit or reduce consumption.
In most states, the new price for one pack hovers around $6, while New York City residents pay around $10. Anita Santos is a 38-year-old hairdresser in New York City who now pays $10•50 a pack for her favourite brand. Although she continues to smoke, she says that hard economic times have forced her to cut back from a pack a day to a pack every 10 days. “About a year ago, when the recession started, I began to cut down”, said Santos. Although Santos says she isn’t quite ready to quit, local public health officials say they have seen an increase in people calling in to telephone “quit lines”.
“For the many New Yorkers looking to save money during these tough times, [quitting] is a great way to do it”, said Thomas Frieden, New York City health commissioner, in a statement.
Studies by economists and the Centers for Disease Control and Prevention (CDC) have shown that a 10% increase in price leads to about a 4% reduction in consumption by adult smokers and a 7% reduction among young people.
Cigarette consumption has been levelling off and on the decline in recent years in many developed countries in western Europe and North America, according to WHO. But the epidemic is now shifting to developing nations and global smoking prevalence is expected to increase at a steady rate over the next three decades.
Stanton Glantz, professor of medicine and director of the Center for Tobacco Control Research and Education at the University of California, San Francisco, CA, says education and other policies and a changing social environment have helped many Americans avoid smoking and quit. “Smoking is increasingly socially unacceptable, and smoke free policies make it harder to find places to smoke”, Glantz says.
During a recession, Glantz notes that, if people have less disposable income, higher prices are likely to force them to cut back. But other researchers are arguing that the economic recession may actually lead to an increase in smoking, at least in the USA.
Michael Eriksen, director of the Institute of Public Health at Georgia State University in Atlanta and a co-author of WHO’s biannual Tobacco Atlas, says two indicators suggest that the economic downturn may not lead to a decrease in smoking. One factor is the most recent prevalence data from the CDC’s National Health Interview Survey, which shows that when the recession began in early 2008, people began to smoke more. From January to September, 2008, 20•9% of adults said they were current smokers, up from the 2007 estimate of 19•7%. According to Eriksen, smoking rates have been declining gradually and this is the first time there has been an increase in the past decade. “We’re probably seeing relapse: people who quit are relapsing back to previous smoking behaviour, as the recession puts them under a lot of stress”, he says.
Eriksen also points to the relative stability of the credit outlook for tobacco companies. According to a March report by Moody’s Investors Service, although the economic downturn has put pressure on sales and new taxes were recently levied, the companies’ profitability should continue to be strong. “You can still buy cigarettes anywhere you turn, so you have affordability, accessibility, and addictiveness, which combine to allow tobacco companies to manage this economic storm”, said Eriksen. “It’s a paradoxical phenomenon: even though people have less money to spend, they still buy cigarettes.”
But some economists question whether tobacco companies will remain as profitable with the introduction of the new tax and the economic downturn. Frank Chaloupka, a professor of economics and health policy at the University of Illinois at Chicago says that the tobacco companies prepared for the tax hike by increasing prices on their own by $0•80 3 weeks earlier. “But the tax should mean that the tobacco companies eventually lose sales”, says Chaloupka.
The Lancet, Volume 373, Issue 9673, Page 1415, 25 April 2009
doi:10.1016/S0140-6736(09)60805-9 Cite or Link Using DOI
By David Kuneman, Research Director, Citizens Freedom Alliance, Inc.
Don’t say I didn’t tell you so! David W. Kuneman’s research at
Smokers pay the price with new cigarette tax passed by Obama.
April 2, 2009
PROMISES, PROMISES: Obama tax pledge up in smoke
Apr 1, 2009
By CALVIN WOODWARD
WASHINGTON (AP) – One of President Barack Obama’s campaign pledges on taxes went up in puffs of smoke Wednesday.
The largest increase in tobacco taxes took effect despite Obama’s promise not to raise taxes of any kind on families earning under $250,000 or individuals under $200,000.
This is one tax that disproportionately affects the poor, who are more likely to smoke than the rich.
To be sure, Obama’s tax promises in last year’s campaign were most often made in the context of income taxes. Not always.
“I can make a firm pledge,” he said in Dover, N.H., on Sept. 12. “Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”
He repeatedly vowed “you will not see any of your taxes increase one single dime.”
Now in office, Obama, who stopped smoking but has admitted he slips now and then, signed a law raising the tobacco tax nearly 62 cents on a pack of cigarettes, to $1.01. Other tobacco products saw similarly steep increases.
The extra money will be used to finance a major expansion of health insurance for children. That represents a step toward achieving another promise, to make sure all kids are covered.
Obama said in the campaign that Americans could have both—a broad boost in affordable health insurance for the nation without raising taxes on anyone but the rich.
His detailed campaign plan stated that his proposed improvement in health insurance and health technology “is more than covered” by raising taxes on the wealthy alone. It was not based on raising the tobacco tax.
The White House contends Obama’s campaign pledge left room for measures such as the one financing children’s health insurance.
“The president’s position throughout the campaign was that he would not raise income or payroll taxes on families making less than $250,000, and that’s a promise he has kept,” said White House spokesman Reid H. Cherlin. “In this case, he supported a public health measure that will extend health coverage to 4 million children who are currently uninsured.”
In some instances during the campaign, Obama was plainly talking about income, payroll and investment taxes, even if he did not say so.
Other times, his point appeared to be that heavier taxation of any sort on average Americans is the wrong prescription in tough times.
“Listen now,” he said in his widely watched nomination acceptance speech, “I will cut taxes—cut taxes—for 95 percent of all working families, because, in an economy like this, the last thing we should do is raise taxes on the middle class.”
An unequivocal “any tax” pledge also was heard in the vice presidential debate, another prominent forum.
“No one making less than $250,000 under Barack Obama’s plan will see one single penny of their tax raised,” Joe Biden said, “whether it’s their capital gains tax, their income tax, investment tax, any tax.”
The Democratic campaign used such statements to counter Republican assertions that Obama would raise taxes in a multitude of direct and indirect ways, recalled Kathleen Hall Jamieson, director of the Annenberg Public Policy Center at the University of Pennsylvania.
“I think a reasonable person would have concluded that Senator Obama had made a ‘no new taxes’ pledge to every couple or family making less than $250,000,” she said.
Jamieson noted GOP ads that claimed Obama would raise taxes on electricity and home heating oil. “They rebutted both with the $250,000 claim,” she said of the Obama campaign, “so they did extend the rebuttal beyond income and payroll.”
Government and private research has found that smoking rates are higher among people of low income.
A Gallup survey of 75,000 people last year fleshed out that conclusion. It found that 34 percent of respondents earning $6,000 to $12,000 were smokers, and the smoking rate consistently declined among people of higher income. Only 13 percent of people earning $90,000 or more were smokers.
Federal or state governments often turn for extra tax dollars to the one in five Americans who smoke, and many states already hit tobacco users this year. So did the tobacco companies, which raised the price on many brands by more than 70 cents a pack.
The latest increase in the federal tax is by far the largest since its introduction in 1951, when it was 8 cents a pack. It’s gone up six times since, each time by no more than a dime, until now.
Apart from the tax haul, public health advocates argue that squeezing smokers will help some to quit and persuade young people not to start.
But it was a debate the country didn’t have in a presidential campaign that swore off higher taxation.
Lawmakers once again turn to cigarette taxes to balance their budgets
February 12, 2009
By Michael Flynn
Three weeks ago President Barack Obama entered the history books and the White House, riding a promise to change the way Washington works and to inject new ideas into stale policy debates. It is too soon to tell whether he’ll succeed in changing DC, but here’s hoping this mandate for change gets heard in the nation’s state capitals.
From Albany to Sacramento, America’s governors and state legislators are showing that there’s nothing like that “old-time religion.” Change may be in vogue among voters, but their elected representatives in state government are like that old vaudeville troop that can’t let go of its old laugh lines.
The skit this year, of course, is another “budget crisis.” In states across the country, the public is being told that parks will close, workers will be furloughed and, in California, IOUs instead of tax refunds will be mailed to taxpayers. The Center for Budget Policies and Priorities warns that “at least 39 states have made or proposed budget cuts that threaten vital services” and face total deficits of $350 billion over the next couple years. Other research organizations report deficits less than a third of that, but are still quite concerned.
The bipartisan National Conference of State Legislatures says state budget figures are “absolutely alarming, both in their magnitude and the painful decisions they present to state lawmakers.”
Do these sky-is-falling state budget forecasts sound familiar? They should.
In 2002, the National Governors Association issued a press release saying that “states face the most dire fiscal situation since World War II.” In 1990, The New York Times reported that states and cities faced a “fiscal calamity.” Fire up Google, pick almost any year and you’ll find lots of stories about a “fiscal crisis” in the states.
For decades states have been on a predictable schedule. In good economic times, they collect a lot more tax revenue than they really need. But instead of giving the money back to taxpayers or putting it into a rainy-day fund, they pretend the good times will never end and they spend it. When the good times do end, they plead poverty and either ask the federal government for help or raise taxes on their beleaguered citizens. Eventually, the economy rebounds and the vicious cycle starts again.
Look at the boom years preceding this recession. State general fund revenue increased twice as fast as inflation. In the five years between 2002 and 2007, revenues grew so much that state governments collected almost $600 billion more than if revenues had just kept pace with inflation. Had they been responsible, they could have maintained all state services, increased spending to compensate for inflation and population growth, and enacted a half-trillion dollar tax cut.
Instead, lawmakers ploughed the windfall into new spending. From 2002 to 2007, overall spending rose 50 percent faster than inflation. Education spending increased almost 70 percent faster than inflation, even though the relative school-age population was falling. Medicaid and salaries for state workers rose almost twice as fast as inflation.
Unfortunately for taxpayers, this money is gone or is now built into ever-expanding baseline spending. So, state lawmakers are once again sounding the alarm about a budget crisis that they ‘just couldn’t have seen coming.’ And, they’ve again reached into their old bag of tricks and warned about closing parks, cutting back on services and laying off teacher, firefighters and other state workers. It’s as if the last dollar the government spends each year is to keep a park open.
Desperate for an infusion of cash, politicians have turned to their oldest stand-by; cigarette taxes. Even after decades of steady increases in tobacco taxes, state lawmakers in at least a dozen states are looking to raise cigarette taxes.
Right now, government makes more off the sale of a pack of cigarettes than tobacco companies. In some states, two-thirds of the price of a pack already goes to government. This will get worse because Congress just hiked the federal cigarette tax 61 cents a pack to help pay for the expanded State Children’s Health Insurance Program.
The overwhelming majority of cigarette taxes are paid by low-income households. In a recession, you’d think lawmakers would want to give these folks a break. But, lawmakers’ habits are hard to break even when it is clear that tax increases don’t raise any new revenue.
In 2006, New Jersey raised its already high cigarette tax, thinking it would bring in an extra $30 million a year. It didn’t. Worse, it caused their actual collections to drop by more than $20 million. The tax increase threw the state’s budget off by $50 million, money that had to be made up by other taxpayers. This isn’t unique to the Garden State. Since 2003, there have been 57 cigarette tax increases across the country. In 37 (68 percent) of those cases revenues failed to meet projections.
Isn’t it time we retired this skit? We’re almost one decade through the 21st century and our esteemed lawmakers in state capitals are still using a decades-old recipe: Boom and bust budgets; cigarette taxes when times get tough. Stir.
It seems our state lawmakers have reached their “sell-by” date.
Cigarette Tax Increases Cut Smoking While Harming Bonds’ Health
By Joe Mysak
February 19, 2009
Smokers, I sent this out yesterday. This morning I called Obama’s contact number, and got a human to comment to. She was not very happy with me. After being a Democrat my entire life, I am now loyal to no party. They are both owned by pharmaceutical lobbyests. I told the White House message taker, that I do not like getting lied to. I believed Obama when he said that there would be NO raising of taxes. Doesn’t include smokers, huh? He said he would not cater to special interests. What the hell is RWJF?????? Our government should NOT be assisting J&J; in selling their nicotine replacement products! I don’t care how much money they donate. The half a billion a year that RWJF spends in tormenting smokers should be used for children’s health care. In a few monthes, a carton of cigarettes will go up another $6.10. This money will allow families making up to $88,000.00 per year to get free health insurance. $88,000.00 would be a fortune to me! I make half that and buy my OWN health insurance. This is obscene!!!!!
CALL AND TELL HIM————-
Obama at the Whitehouse comment phone number 202-456-1111. A person really answers.
— I wrote:
Subject: nation wide funding for smoking bans
Date: Wednesday, February 4, 2009, 11:30 AM
The Robert Wood Johnson Foundation has been the major funding on County, State, and the Federal level. This Foundation is the partner to Johnson and Johnson, distributors of Nicoderm,Nicorette, and Chantix. They hold over 66,000,000 in J&J; stock. I just looked up Robert Wood Johnson donations to anti smoking groups- WOW. American Cancer Society, CDC, WHO, State Governments, County Health Departments, all recieve grants from RWJF. And they always agree with the grantors agenda. NONE are lobbying to stop the selling of tobacco.
Personally, I think this is a terrific way to market these nicotine replacement products. I am however, terrible disappointed that my Government is participating in this marketing scheme. And I am confused why the press has not reported the contributions of this huge corporation to political candidates, and County, and State governments, through grants and funding junkets for politicos.
If you want people to stop smoking, make it illegal to sell tobacco.
This is NOT what the Robert Wood Johnson Foundation, with the help of our government, is trying to accomplish. They want to ostracize and embarras smokers into using their Nicoderm, Nicorette, and Chantix. All the while our government finds this horrible, deadly, blood money quite easy to take, while they are saying they want people to quit.
You tell me, WHAT THE HELL DO THEY WANT!
There’s a story here. The smallest communities throughout this country are being lobbied to force Americans out into the streets to use a LEGAL product, on PRIVATELY owned property. Local Health Department employees are advertising for Nicoderm, Nicorette, and Chantix. They do NOT offer to GIVE these products away. These grants, from a company that sold over $64,000,000,000 ( that’s billions) total over $400,000,000 in a year. Piddling amount to buy a country!
I realize that newspapers make tons of money in advertising these drugs, and so cannot be expected to tell the truth about this. National Public Radio even takes funding from RWJF. No news source will report this.
Sorry, but I don’t think it is my personal job, to provide socialized medicine for poor people. I’m working, and paying my own health insurance, and all my other bills. If the elite, want all children insured, why don’t we take all the donations from the Robert Wood Johnson Foundation,and apply these funds to the poor. Half a billion a year would cover it.
Where can we go to get the truth?
(- A Newsletter Reader)
President signs bill extending coverage to 4 million more kids
WASHINGTON – President Barack Obama sees expansion of government health insurance to millions of lower-income children as a first step of several to come in providing coverage for all Americans.
Moran, Berry Introduce Health Care Bill
Legislation Ensures Patient Access to Medical Equipment, Quality Health Care
WASHINGTON, D.C. – Congressmen Jerry Moran and Marion Berry (AR-01) held a press call today to discuss legislation introduced yesterday that preserves Americans’ access to affordable health care supplies. H.R. 616 will ensure community pharmacists are exempt from a Centers for Medicare & Medicaid Services’ (CMS) accreditation requirement in order to sell Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS).
“It is essential that community pharmacists continue to provide patients with quality health care,” Moran said. “Community pharmacists are the only licensed medical professionals subject to this unnecessary and unfair CMS regulation. To guarantee their equal treatment, Congressman Berry and I introduced this legislation which will ensure that pharmacists can continue to provide the equipment and services necessary to keep patients healthy.”
“In rural areas, including many small towns across Arkansas, community pharmacists are often the only medical professionals available who can supply this vital equipment to patients,” Berry said. “The current law threatens the ability of patients to get the supplies and care they must have to stay healthy. This bill will ensure Medicare patients have access to the supplies they need while also helping community pharmacies keep their doors open.”
The Medicare Improvements for Patients and providers Act of 2008 (MIPPA) gave the authority to exempt certain health professionals from the DMEPOS accreditation requirements. The CMS accreditation requirement threatens patient access to important medical products by adding unnecessary bureaucratic costs and prevents many pharmacists from being able to continue to provide vital equipment and supplies to their patients.
Moran and Berry introduced H.R. 616 to add community pharmacists to the list of medical professionals that have been conditionally exempted from the requirement by CMS (i.e. physicians, physical therapists, nurse practitioners, orthotists, prosthetists, opticians, etc.). Currently, community pharmacists are the only licensed medical professionals that must meet new CMS accreditation requirements as Medicare suppliers of DMEPOS. Pharmacies are already licensed and highly regulated by state and federal authorities. This change will preserve patient access to necessary medical supplies and equipment.
The American Pharmacists Association (APhA), Food Marketing Institute (FMI), National Association of Chain Drug Stores (NACDS), National Community Pharmacists Association (NCPA) and the National Alliance of State Pharmacy Associations (NASPA) representing pharmacists, community pharmacies and state pharmacy organizations nationwide support this legislation.
U.S. House approves SCHIP expansion hiking tobacco, cigarette taxes
January 14, 2009
Dayton Business Journal – by Mike Sunnucks DBJ Contributor
The U.S. House of Representatives passed a bill Wednesday to raise federal tobacco taxes and expand the State Children’s Health Insurance Program.
The $33 billion bill would raise federal taxes on cigarettes, cigars, rolling paper and other tobacco products to help fund the expansion. Cigarette taxes would rise from 39 cents per pack to $1.
Congressional Democrats previously pushed to extend the program to uninsured middle-class children, but efforts were vetoed by President Bush, who wanted the federal program geared toward the poor. President-elect Barack Obama is expected to sign the SCHIP expansion if it gains Senate approval.
House Democrats backed the expansion saying it will bring health insurance to more uninsured children.
The federal tobacco tax increase, however, faces criticism from economic conservatives.
“Tobacco tax increases over the years have resulted in less smoking and therefore a decline in tobacco tax revenue. Tying the expansion of a government program to a declining revenue source is the sort of backward thinking that makes taxpayers scratch their heads,” said Steve Voeller, president of the Arizona Free Enterprise Club.
A group of conservative economic groups wrote members of Congress earlier this month saying continued tobacco tax increases scapegoat smokers and hurt retailers and other small businesses by sending buyers online where they often can avoid such taxes.
SCHIP: CONGRESS GETS IN LINE TO TREAT SMOKERS AS NON-PERSONS
Established in 2000 with a particular eye on New York, C.L.A.S.H. (Citizens Lobbying Against Smoker Harassment) has grown into a nationally active grassroots organization dedicated to advancing, promoting and protecting the interests of adults who choose to smoke tobacco. It’s now comprised of citizens from all over the country who have bonded together in the common conviction that smokers have been scapegoated: unmercifully demonized and financially punished by legislatures where they have never been granted the right to be heard or to defend their patent interests. This is illustrated starkly by the proposal to fund the State Children’s Health Insurance Program (SCHIP) through increased taxation on people who use tobacco in any of its forms.
In case it’s been overlooked, tobacco doesn’t pay taxes, people do — and a minority (43.4 million people  ) have been repeatedly singled out to pay for government programs that ostensibly benefit society as a whole . C.L.A.S.H., joined by other like-minded organizations, is appalled that the interests of this large constituency have never been represented, or even considered, by the legislators who claim to represent
all. No one from any of our organizations has ever been invited to any official meeting or congressional hearing on matters that so very vitally concern us– and negatively impact us– both financially and socially.
Historically, government has stepped in to protect minorities from being beaten up. This time lawmakers choose to join the mob and land kicks of their own, and to further codify a manufactured intolerance into national tax policy.
Adult citizens who smoke have de facto become a “class” thanks to anti-smoker crusaders. However, unlike any other classes, we’ve been allowed no voice at the legislative level. We adamantly reject the bizarre contention that Public Health “experts” and anti-tobacco special interest groups speak on our behalf. Neither do any of the tobacco companies.
Once again, in the proposed funding for SCHIP, smokers have apparently become non-persons, relegated to the status of a passing technicality in a section titled “Funding.” We feel the need to remind the government that we are not Funders, but rather human beings, frustrated and infuriated to be the never-ending targets of use and abuse, and whose voices are never heard.
When our President-Elect promised that he wouldn’t raise taxes on “anybody” but then “looks forward” to signing this bill, it seems to make it official that smokers aren’t “anybody.” Not citizens; not persons.
This is close to Taxation without Representation, for what use is a vote when we’re never “represented”? It would be hard to count as far as the fingers of one hand the number of legislators– at any level of government– local, state or federal–who’ve been heard to object to the selective, persecutory taxation of smokers on the grounds of unequal treatment. Most, if anything, seem to represent whoever it is that benefits from the smokers’ coerced beneficence. We are no one’s constituents. Even those protesting that this is a tax against the poor are representing “the poor,” and notably not that second-class category, the smokers.
Elected officials are either intent on persecuting us or victimizing us, depending on subscribed beliefs on smoking. For the smokers that dare to defy demands to conform (don’t smoke) lawmakers will impose it on them coercively (smoking bans and high taxes). On the other hand, Public Health insists, and lawmakers believe, that nicotine is “more addictive then cocaine and heroin” (however contradictive that is to their other assertion that merely charging more will cause one to quit). In that case, government is guilty of preying on the “weak” as a source guaranteed to keep paying.
The Heartland Institute (2), The Heritage Foundation (3), Americans for Tax Reform (4), and even C.L.A.S.H. in the past (5), among others, have publicly issued extensive material that documents the flaws in terms of economics and rationale. The incongruities in both have been well established, yet stunningly unheeded, let alone intelligently refuted. There is a breakdown in reason by our elected officials that is beyond anything intellectual. That’s because there’s a more malevolent force at work that’s long been shunned in regard to other minorities: bigotry. The kind that doesn’t let us in the front or any other door.
While C.L.A.S.H.’s intent is to emphasize adult smokers’ disenfranchisement from the process and not to belabor the economic details it deserves at least some further attention. Supporters of funding SCHIP with tobacco taxes stand on two main points in that regard:
1. It will have the added benefit of reducing smoking by adults and discouraging initiation among “children.”
Pardon the pun but, finally, it would be criminal to overlook the section of the bill (7) that closely follows the detailed dollar amounts of the tax increases on tobacco, entitled “Treasury Study Concerning Magnitude of Tobacco Smuggling in the United States.” It’s Congress’ admission that they are about to be the ones responsible for inciting this newly more lucrative market. They anticipate it in black and white. Congressman Peter King (R-NY), a ranking member of The Committee on Homeland Security, has been most vocal about evasion of cigarette taxes to date leading to “a surge in smuggling and a consistent cash flow for global terrorist groups.” (8)
It seems that’s not enough to put a chill on the plan. Congress, it would seem, has more animus towards adults who choose to smoke than it has towards terrorists.
Here’s a guy who “cut myself a little slack” for smoking because running for president was stressful who then cuts other indulgers none during the worst, most stressful economic downturn in four generations.
Opening act for Congress: raising taxes
A tax increase on smokers soon, and tax hikes on others in 2011
Jan. 8, 2009
A lot of people are in favor of Obama’s beloved SCHIP bill which will expand free government-paid health insurance subsidies to middleclass parents.
But a lot of them don’t know that this is being done purely at the expense of a poorly organized minority group: smokers. The SCHIP funding expansion depends COMPLETELY upon a 150% federal tax increase on most smokers and an incredible and outrageous 814% tax increase on the poorest of the poor, that pool of smokers who can’t afford to buy ready-made cigarettes and must resort to rolling their own from loose tobacco.
An 814% tax increase on an unorganized, small, and very poor minority in order to pad the pocketbooks of a well-organized and far larger and richer group that delivers lots of votes on election day.
Is that supposed to be how America works?
Michael J. McFadden
Author of “Dissecting Antismokers’ Brains”
Read More: USA Federal Tax Alert Page 3