Pa. lawmakers consider tax on natural gas, cigars
Tuesday, June 15th, 2010
By: Scott Detrow
scott_detrow@pubradionews.net
The Pennsylvania state House is expected to vote today on a budget bill that would increase cigarette taxes and impose a levy on natural gas drilling.
The House was set to act on its tax bill in late May, but Democratic leaders postponed the vote after caucus members' support wavered.
The bill has since been amended – it now includes a cigar tax, and reduces its cigarette tax increase from 30 to 10 cents a pack.
Johnna Pro, the spokesperson for House Appropriations Chair Dwight Evans (D-Philadelphia), says Democrats feel like that's a better approach.
“I think, once folks really had a chance to sit down and look at the numbers,” says Pro, “it made more sense to do a lower cigarette tax increase, and then bring cigars back into the mix. We are the only state that doesn't tax cigars.”
The bill also includes an eight percent tax on natural gas drilling, and caps the discount given to vendors who turn in tax revenue at $500,000.
Pro says the package generates about $280 million for the commonwealth's general fund.
If the measure passes it heads over to the Senate, where Republican leaders say they're opposed to any tax increases.
The cigar tax is ridiculous. As Jim says, it will drive away the one industry PA actually attracts! Second, lawmakers forget that cigar smokers aren't addicted to their smokes like cigarette smokers are. We can quit. Or we can smoke less. Either way, these politicians are trying to stick it to someone else, garnish an extra vote or two, use phony revenue numbers to pass a budget, and in the end, collect no additional revenue.
There is a reason why the cigar industry is doing relatively well (compared to the rest of the country) in PA – no explicit tax on cigars! Cigar businesses have come to PA to set up shop because of this. Creating a new tax on cigars will result in business closures and more unemployment. PA consumers will simply turn to the internet for all of their cigar purchases and avoid paying the PA taxes (new cigar tax, sales tax) anyway. PA has gained much revenue from the cigar "industry" by NOT taxing cigars (through employment taxes and sales taxes). When will people wake up to this concept???
Johnna, said "We are the only state that doesn't tax cigars.". What about D.C., Florida, Kentucky, Maryland, Virginia, West Virginia, and Wyoming (as per http://fujipub.com/cigartax.html)