Legislature Tries to Unfairly Tax Small Businesses

From Alan Brock:

The Republican lead Legislature is attempting to raise taxes!!!

In 1997 the State of Florida settled with the five major tobacco companies for over 13 Billion dollars to be paid out in increments over the next twenty five years. We are in year eight of the tobacco settlement. This year the state of Florida will collect over 400 Million dollars in settlement dollars from the companies that are commonly called Big Tobacco. The State of Florida will also collect an additional 400 Million dollars in existing tobacco excise taxes.

Because Florida is one of four states that are independent of the Master Tobacco Settlement that the USA settled with Big Tobacco (after Florida's settlement), we have different rules here than in other states. We also have very low tobacco taxes. This has caused many new cigarette companies to sprout up and start selling cheap cigarettes in our state. Our tobacco taxes are so low that certain packs of cigarettes are selling for as little as $1.50 (compared to over $5 in the state of New York for cheap cigarettes).

Currently Legislators, of both parties, are trying to raise taxes on the non-settlement tobacco brands. The argument being made is that this tax will make them more competitive with Big Tobacco's brands. This will also have them contribute more money to the high cost of the tobacco related illness that our state has to cover each year. The legislators are also saying that this will help fund an anti-tobacco program.

These are all good ideas, but this is where I start to become frustrated with the legislative process. Our state already brings in over $800 million dollars a year from tobacco. If the state allocated 10% of that current money to an anti-tobacco program we would meet the minimum CDC recommend funding for anti-tobacco programs for the State of Florida. Our state currently cringes at funding an anti-tobacco program with $1 million dollars. Why would this change with a new tax? Taxes are always raised for a specific reason, but too often the reason the tax was raised is forgotten and the money is transferred to other state accounts where it can be used to add more pork barrel projects for legislators to give to their constituents back home. There is no excuse for not fully funding an anti-tobacco program in our state.

These small tobacco companies have found a loop hole, a place where they can make a profit selling an addictive product cheaper than their competition. Big Tobacco denied for 100 years that tobacco was addictive or that it had any long term health affects. They went so far that in 1994, the 5 major tobacco companies CEOs went before a congressional hearing and stated that they didn't believe that tobacco was addictive or harmful. During the settlement it was found through their confidential documents that they knew that tobacco was harmful and addictive. However, they did research ways to make smoking healthier (which they chose not to do, because that would be admitting that it wasn't healthy) and more addictive (which they did do). The anti-tobacco Truth campaign was started to help raise awareness about these deceptions. It is this history that caused them to be faced with such a large punitive settlement. They had lied for a hundred years. They are still manipulating the facts. By taxing the small tobacco companies (these small businesses) the state will help increase Big Tobacco's market share and help decrease the weight of the message that the tobacco settlement, and the accompaning implied guilt, sends to our young citizens.

Don't misconstrue this posting as anti-tobacco taxes either. The only proven way to decrease tobacco consumption is to raise taxes. I just strongly feel that it is wrong to single out the small businesses without the long history of intentional deceit and abuse for the tobacco tax increase. I feel that we should raise tobacco excise taxes across the board for all tobacco products and brands. This will decrease the number of smokers, and particularly the number of poor smokers who won't be able to afford the high medical cost associated with a lifetime of smoking. The higher taxes, if used appropriately, can discourage more people from starting to smoke and help cover the high medical cost for the smokers in the future.

I hope that our Legislators take a hard look at this legislation and all of its ramifications before voting in its favor.