Tuesday, June 26, 2012

Cigarette Tax Proposal Gets Smoked

Posted By on Tue, Jun 26, 2012 at 2:25 PM

click to enlarge Election results are out
  • Election results are out

When we last checked in nearly three weeks ago, supporters and opponents of Proposition 29, which would increase a cigarette tax by $1 per pack, were probably tempted to chain-smoke away the nerves from too-close-to-call election results.


Now you can dump those ashtrays, because the ballot initiative appears to have been defeated.

Technically, as of the weekend, there were still some 100,000 uncounted ballots. But an Associated Press analysis concluded that the contest was already decided, and on Friday the "Yes on 29" campaign conceded defeat.

For tobacco companies, it was $47 million well spent. To put that amount in perspective, the San Jose Mercury News notes that "Jerry Brown spent about $36 million in his successful 2010 bid to become governor of California. Wisconsin Gov. Scott Walker and his allies spent $47 million to beat back his recall challenge on June 5."

While the vote see-sawed soon after the polls closed on June 5, the nays have had a tight but steady lead since. The tally going into the weekend was 50.3 against and 49.7 in favor. The difference, as of last count, was about 28,000 votes. Many of the final uncounted ballots, though, are from areas that opposed the measure.

As a result, California's cigarette tax will remain at 87 cents, the 19th cheapest in the country. The tax would have bumped it up to $1.87, making it the 36th cheapest. The revenue would have brought in around $800 million a year to cancer research and smoking prevention programs.

Opponents of the measure argued that none of the money is going toward closing the state's budget deficit, that none of the money is going toward cancer treatment, and that the money can be spent outside California.

In March, a Public Policy Institute of California poll showed that more than two-thirds of voters supported the proposal. Over the next two months, as each side mounted its ad campaign, the votes swung the other way. By May, support for Prop. 29 had dropped to just over 50 percent.

The "Yes on 29" campaign raised $11 million, including contributions from Lance Armstrong and NYC mayor Michael Bloomberg. "No on 29" raised $47 million , including more than $20 million from Philip Morris and more than $10 million from R.J. Reynolds.

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Albert Samaha

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