Lawmakers say they’d back increase in cigarette taxes|[05/10/07]

Published 12:00 am Thursday, May 10, 2007

Legislators representing Warren County said this morning they will support Gov. Haley Barbour if he moves toward a cigarette tax increase in years to come – but it’s conditional.

&#8220I voted for the cigarette tax and I’d probably vote for it again, if it would come out as a separate item,” Rep. Chester Masterson, R-Vicksburg, said.

Masterson, a retired physician, is seeking the state Senate seat being vacated by Sen, Mike Chaney. While he backed higher taxes on cigarettes, Masterson, like Chaney, followed Barbour’s lead in 2006 and 2007 sessions and did not support combining a tobacco tax increase with a grocery tax reduction.

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Masterson, who faces primary opposition from retired state trooper James &#8220Buddy” Terrell and attorney Briggs Hopson, said his position won’t likely change. &#8220He’s got it mixed in with other tax breaks,” Masterson said. &#8220I probably would not vote for the mixed bill.”

Businessman Eric Rawlings is seeking Chaney’s seat as a Democrat.

Barbour said he wants to overhaul the state tax structure in the next few years, and he didn’t rule out a cigarette tax increase if it’s part of a package that helps reduce Mississippians’ total tax bill.

&#8220In looking at the system as a whole, the goal will be significant tax reduction,” Barbour said. &#8220But we may see some things in there that need to be adjusted up, which would allow us to reduce other taxes even more.”

Barbour, also Republican, has vetoed bills in the last two legislative sessions that would’ve increased Mississippi’s cigarette tax to $1 a pack while decreasing the 7 percent grocery tax. Mississippi has the third-lowest cigarette excise tax – 18 cents a pack – and the highest state grocery tax in the nation.

Barbour, seeking re-election himself, is a former Washington lobbyist whose clients included tobacco companies, and critics often cite those connections. Supporters of the cigarette and grocery &#8220tax swap” believe raising the cigarette tax would help reduce smoking, which costs the state millions of dollars a year for health care.

Rep. George Flaggs, D-Vicksburg, said Barbour’s statement was not shocking.

&#8220I’m not surprised that he’s changed because 80 percent of the people said we were going in the right direction,” Flaggs said. &#8220He said he’s considering a tax package that will be fair, and that’s what we’ve been saying all along.”

However, tax change must be across the board, said Flaggs, who voted with his House colleagues in favor of the tax swap every time it was proposed.

&#8220While we look at the taxes, we ought to look at the exemptions at the same time,” Flaggs said. &#8220It is grossly unfair for us to tax baby food and not horse feed.”

Flaggs is also seeking re-election and has a Republican opponent, the Rev. Rick McAlister.

The state Tax Commission has found that increasing the cigarette tax to $1 a pack and cutting the food tax in half could create a small gain in revenue for the state.

Rep. Chuck Middleton, D-Port Gibson, who voted for a cigarette tax last year, said he would do it again if it’s good for Medicaid.

&#8220Last year, I was concerned about the effects of cigarettes on the cost of Medicaid and our medical system,” he said. &#8220If those funds could be diverted to help offset the cost of Medicaid and medical services, then I would be in full support of that. I would take a look at it and strongly consider anything the governor presents to us.”

Barbour discussed the state tax structure during a meeting with the editorial board of the Northeast Mississippi Daily Journal.

The governor told The Associated Press during an interview Wednesday at the Mississippi Emergency Management Agency headquarters in Pearl that the state’s recovery from Hurricane Katrina is too uncertain for tax changes now. Barbour was at MEMA for a news conference on a two-day hurricane drill meant to prepare the state for the upcoming storm season.

&#8220We still have too much uncertainty from Katrina. In a year, perhaps as long as two years, we will have stable revenue and at that time I will have already had a study of our tax system completed,” Barbour said Wednesday. &#8220We need to look at the tax system in its entirety if we are going to have appropriate tax reform and tax cuts.”

Barbour said the study would consider all taxes that Mississippians pay – federal, state and local. Lawmakers would have to approve any changes in the state tax structure.

Barbour, elected in 2003, is expected to face Jackson attorney John Arthur Eaves Jr., a Democrat, in the Nov. 6 general election. Eaves and Barbour are expected to defeat lesser known opponents in their Aug. 7 party primaries.