Mississippi legislators reconvene next week to continue haggling over whether to send a bill to increase taxes on cigarettes to the governor, and how high the tax should be, reports Forbes.com.
The House passed HB 364 in January, which bumped the nation's third-lowest tax rate on cigarettes to $1 per pack. Currently, the state tax on a pack of cigarettes is a mere 18 cents.
The Senate countered the House by voting for less than half that increase, limiting the rate to 49 cents per pack. Their current offer is 55 cents, coming closer to the average for surrounding states.
Rep. Percy Watson, D-Hattiesburg, and chairman of the House Ways and Means Committee, told Forbes that the Senate offer is still too small, and that he will not accept it.
Recently passed legislation may be responsible for Watson's strong bargaining position, according to Forbes:
When Mississippi lawmakers started debating the issue in January, the average of the cigarette taxes in Louisiana, Arkansas, Tennessee and Alabama was about 49 cents a pack. That's why the Mississippi Senate originally voted for that amount.
In the past few weeks, though, Arkansas has increased its cigarette tax from 59 cents a pack to $1.15. The new average for the four states surrounding Mississippi is nearly 64 cents a pack.
The federal cigarette tax also is increasing on April 1 from 39 cents a pack to $1.01.
Gov. Haley Barbour has vetoed previous bills proposing a cigarette tax hike, in opposition to polls showing Mississippi voters strongly support an increase. He finally relented last November when the tax-study commission he created recommended an increase. Barbour is a former tobacco lobbyist who still receives income from the Washington, D.C. lobbying firm he founded, deposited to a blind trust.
Per Forbes: Barbour is recommending an increase of 24 cents a pack for premium cigarettes and 43 cents a pack on cigarettes produced by companies that didn't participate in the state's 1997 settlement of a lawsuit against the tobacco industry.
Health advocates continue to push for the higher rate passed by the House.
"Mississippi needs a $1 cigarette tax now," said Roy Mitchell of the Mississippi Health Advocacy Program in a release. "It's a health win that will reduce tobacco use and save lives, a fiscal win that will raise much needed revenue, and a political win that is incredibly popular with Mississippi voters."
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