Tobacco tax may help health care
Maryland Democrats seek to double levy
Democrats in the Maryland House of Delegates and health care advocates are seeking to double the tobacco tax to boost health care and offer incentives to small businesses to provide health benefits.
"The Healthy Maryland Initiative is a smart proposal to keep kids from smoking and to provide health care for 50,000 Marylanders without health insurance," Vincent DeMarco, president of the Maryland Citizens' Health Initiative, said Wednesday.
The group also was behind the high-profile bill requiring Wal-Mart to provide expanded health care coverage to its employees. Gov. Robert Ehrlich vetoed that measure, but the General Assembly overrode his veto last month.
The Healthy Maryland Initiative, would raise the tobacco tax to $2 per pack to create a fund to extend state-funded health care to certain low-income populations, increase funding for programs to help smokers quit, and provide grants to cover up to half of the cost of health insurance coverage for eligible small-business employees.
"We believe that that money will go to such good causes," said Del. Sheila Hixson, D-Montgomery.
Hixson is the lead sponsor of the bill and is the chairwoman of the House Ways and Means Committee. Thirty-one other delegates, mainly from Montgomery and Prince George's counties, have signed on to co-sponsor the bill.
Ellen Valentino, Maryland director of the National Federation of Independent Business, said 67 percent of members of the small business association oppose the legislation.
"They see this as a tax increase on a large segment of the business community with no real solution to affordable health care," she said.
The majority of NFIB members are retailers, Valentino said.
"We are beginning to see this ongoing agenda to expand government programs at the expense of small business," she said.
Should the measure make its way through the House and into the Senate, Ulysses Currie, D-Prince George's, the chairman of the Senate Budget and Taxation Committee, was noncommittal about its fate.
"It's good that it prevents youngsters from smoking," Currie said. "But that does not mean it will pass when it comes over here."
Taxes and tobacco
- The tobacco tax revenue would increase by an estimated $227 million in fiscal 2007 should the bill pass.
- The tax is expected to total $197 million in fiscal 2008 and then decline by about 3 percent annually if the bill passes.
- 11,000 parents enrolled in Medicaid and 11,000 additional people could receive health insurance coverage through small business owners if the bill passes.
Source: Maryland Department of Legislative Services