The smoke has begun to settle from a firestorm of controversy over the placement of an issue on the November ballot relating to the state's cigarette tax, but the battle over Amendment 3 is intensifying as stakeholders dig their heels in for a bitter fight.
The smoke has begun to settle from a firestorm of controversy over the placement of an issue on the November ballot relating to the state’s cigarette tax, but the battle over Amendment 3 is intensifying as stakeholders dig their heels in for a bitter fight.
Amendment 3 seeks to impose a new tax on the purchase of cigarettes. Currently, Missouri has the lowest cigarette tax in the nation at 17 cents.
If approved by voters on Nov. 8, the tax would increase by 15 cents every year for four years until the cigarette tax levels off at 77 cents for most cigarette brands. The revenue generated would go to early childhood education and health funding and smoking cessation programs for expectant mothers.
While that alone sounds positive, many organizations have stepped up to oppose the amendment, including a bipartisan list of 112 state lawmakers, including Rep. Lindell Shumake (R-Hannibal), Rep. Jim Hansen (R-Frankford) and Sen. Brian Munzlinger (R-Williamstown).
“I’ve got an aversion to imposing new taxes as a general principle,” Shumake said.
The amendment creates the Early Childhood Health and Education Trust Fund, overseen by a commission of state employees and appointed citizens to disburse 75 percent of revenue generated as grants to organizations such as Parents As Teachers and other early childhood education programs.
Shumake contends, though, that there’s a better way to fund these programs than through a “sin tax” — a tax on a behavior that some may find disagreeable or even unethical, such a smoking or gambling.
“Imposing any new taxes on any commercial activity, can have a detrimental effect. Personally, I think people should quit smoking period, but a tax isn’t a way to do that,” he said. “And the projects they want to fund, of course it’s good but there are better ways.”
The amendment was proposed by Raise Your Hand for Kids (RYH4K), an organization that has received significant financial backing from RAI Services Company, the parent of RJ Reynolds, which manufactures major cigarette brands like Camel and Pall Mall. According to the most recent Missouri Ethics Commission reports available. RJ Reynolds has contributed at least $2.598 million to push for the passage of an issue that would raise taxes on its own products.
Organizations with ties to health and children have lined up to support the amendment.
“MSBA has had a long-standing position to increase Missouri’s investment in early childhood education,” the Missouri School Boards’ Association said of its endorsement of Amendment 3.
Kansas City Mayor Sly James and St. Louis Mayor Francis Slay have also thrown their support behind the amendment.
But other organizations, including those that have traditionally supported a tobacco tax increase (such as the American Cancer Society), have called into question the intentions of the amendment, as well as many facets found in the small print of the legislation.
A portion of the amendment — which would change Missouri’s Constitution — specifically prohibits the funds generated by an increased tobacco tax to fund “human cloning or research, clinical trials, or therapies or cures using human embryonic stem cells.”
This led Washington University, a leading research institution, to oppose the amendment.
“The harmful anti-research language is in there, and the only conceivable goal is to weaken and penalize stem cell research,” penned former State Sen. Chuck Graham in an opinion to the Columbia Daily Tribune.
Another part of the language prohibits the use of funds “that involve abortion services including performing, inducing or assisting with abortions.” The mention of the very word “abortion” would become the first use of the word in Missouri’s Constitution if approved by voters.
Yet another portion prohibits funds to be used for “tobacco-related research of any kind.”
RYH4K Executive Director Linda Rallo has said the specificity with which the funding is directed in the initiative’s wording was an attempt to make the amendment’s intention “crystal clear” that funding would go only toward early childhood education and health.
“We hope this will become something great for our state,” Rallo told MSBA members at a legislative forum in February.
Some note that perhaps most troubling is the inclusion of an equity assessment fee on smaller brands, labeled as “non-participating manufacturers.” A court settlement in 1998 said the “Big 4” cigarette manufacturers — including RJ Reynolds — would need to pay states in exchange for the state’s promise not to sue cigarette manufacturers for the ongoing cost of medical care for cigarette users.
Many smaller brands or brands that have come around since the court ruling pay into an escrow account for basically the same reason. But in Missouri, the smaller brands are able to receive a refund of the escrow payments because of a loophole.
A 67-cent additional tax on those manufacturers would be imposed with the passage of Amendment 3.
So, if Amendment 3 passes, an additional 60-cent tax would be imposed on a brand such as Camel while a $1.27 (tax increase plus equity fee) tax would be imposed on a brand such as Decade.
A coalition of organization released a statement criticizing the motivation of Amendment 3.
“Undoubtedly, it is profit – not public health – that is the true motivation behind the tobacco industry’s sudden support of such a small tax, and they should not be determining Missouri’s public health policy,” the statement said.
With now 112 legislators opposing the amendment, a bitter fight is expected through the election.
Reach editor Eric Dundon at email@example.com .