When is a fee a tax????
I wrote about our governor's ill-conceived tax, excuse me - "health impact fee" on tobacco products in this post about unintended consequences. Given the news of the last few days, the tax - er...fee - needs to be readdressed.
Recently a Ramsey County judge struck down the legality of the governor's "health impact fee" ruling that the $.75 per pack (of cigarettes) fee violated the terms of the states tobacco lawsuit settlement! Bravo Judge - you got the right answer. The Governor vowed to fight it. When I heard that I was stunned. The Governor has been taking lots of flack about this and other "compromises" from his base. The ouster of his ally (and chief cheerleader) Ron Eibensteiner from the Party chair should have been his wake up call. Then again, maybe it was. Yesterday's Star Tribune reports that the Governor will drop the fee if the appeal fails! Alleluia!
However some, including Republican Minnesota, has asked how can the governor forego the "millions" that the fee will bring in...well considering that the state is looking at a $1B budget surplus I don't think that will be that big of an issue.
The bottom line is that the state can not be balancing the budget on the backs of smokers. As I said back in August, smokers will go elsewhere to get their cigarettes or they will quit smoking. If the Governor were to ask for my solution to the budget issues, I would have a simple 2 word answer for him. REDUCE SPENDING!
Update: I just heard on Fox News that the American Cancer Society (and a coalition of heath care providers) is pushing to get a ballot initiative in California that will increase the cigarette tax $2.60 per pack. I am not a smoker, but if the smokers of America were to rise up in rebellion, I would be right there with them. Here is a link to the story.