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Rowe: Hike Tobacco Taxes to Preserve Social Safety Net
January 28, 2010   Reported By: A.J. Higgins

Former Maine Attorney General Steven Rowe has become the first gubernatorial candidate to call for a tax increase to prevent further cuts in state services. Rowe, a Portland Democrat, says cuts in such areas as prescription drugs for seniors, home and community-based services for the elderly and mental health services will only increase costs in the future. Rowe wants to boost the state's tax on cigarettes, but some of his primary opponents counter that his proposal is, at best, premature, and at worst, misdirected.

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Rowe: Hike Tobacco Taxes to Preserve Social Safet
Originally Aired: 1/28/2010 5:30 PM
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At a time when Maine's current Democratic governor is talking about holding the line on new taxes, another Democrat who wants his job says it's time to up the ante on smokers.

"What I've recommended is that we go to the tobacco tax," Rowe says.  " I believe that it's one of the reasons the price of the cigarettes, as it goes up, fewer people smoke."

One of several Democratic gubernatorial candidates, Steve Rowe is a former Maine Attorney General and Speaker of the House. He says the current budget is cutting too deeply into programs that provide prescription drugs for seniors, home and community based services for the elderly and disabled citizens.

He says the revenues from an added cigarette tax could offset many of those reductions and prevent the costs of those services from being shifted to hospital emergency rooms, homeless shelters and the county jails.

Exactly how much does Rowe think the tax should be raised? "I'm not being specific about that. Of course, the dollar, I believe, will raise about $26 million, which would cover a lot of these services," he says.

"Considering a tax on cigarettes at this time neither demonstrates real leadership on the economy, it's not tax reform, it's tax regressive against, really, people who can least afford it," says former House Speaker John Richardson, who is opposing Rowe for the Democratic nomination.

Richardson, of Brunswick, recently ended his term as Gov. John Baldacci's commissioner for the Department of Economic and Community Development. He says Maine's next governor has to focus on job creation rather than fixate on cigarette smokers.

"We've picked on cigarette taxes for a long time, and the fact of the matter is, it only produces a small amount of money," Richardson says. "What we really ought to be doing is looking at how we're going to re-engineer government, how we're going to grow this economy, how we're going to create jobs, so we have enough money so that we have a strong and vibrant social safety net -- to simply go at this as a typical tax and spend approach, which frankly has failed us and put us in the position we're in.  What we really need to do is to begin to grow this economy."

"The idea of increasing the taxes has usually been posited, not so much to balance the budget, but rather to stop teen smoking, and it has had an impact," says Maine Senate President Libby Mitchell, a Vassalboro Democrat, who also wants to become Maine's next governor.

She says the idea of increasing the cigarette tax to offset cuts in state services would not begin to address the impact of reductions in the current supplemental budget, which advocates for the poor have estimated at $400 million dollars when federal matching funds are factored in.


"To balance the budget, it would not be a sustainable balancing of the budget, because the whole notion is to get people to stop smoking, and if they stop smoking, there's going to be less revenue," Mitchell says.  "That's the whole purpose, is to stop smoking.  Will it be considered?  It will be considered very fairly this session, and even the governor has said he's supported a cigarette tax before. It' sjust for those of us who are in the throes of making these decisions, it's a little early to know the right answer."
 
Betsy Sweet, of Moose Ridge Associates, advocates for many Mainers in need of state services. She says that while any additional human services revenues would be welcomed, she thinks smoking prevention is the real reason to support Rowe's proposal.

"The number one reason to raise the tobacco tax right now in Maine is because we are losing ground in preventing kids from starting to smoke," Sweet says.  "Maine used to have the highest tax in New England on cigarettes, now we're the second lowest, so there's five other states ahead of us.  And our youth smoking rate has gone down consistently since 1997. Last year for the first time, our youth smoking rate is back up. The number one way to keep kids, or as she calls them, "replacement smokers," from starting, is to raise the price.

Maine currently imposes a $2 tax on each pack of cigarettes sold. 


 

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