The last of the four proposed amendments arising from the citizen initiative process is 72 – Tobacco Taxes for Health Related Purposes. Again, I urge a “NO” vote on this amendment.
What Amendment 72 Does
If passed, Amendment 72 would raise the tax on a pack of cigarettes by $1.75 per pack, bringing the total tax up to $2.59 per pack ($25.90 per carton).
According to the 2016 State Ballot Information Booklet (the “Blue Book”), this tax would raise an additional $315.7 million for the state budget. The proceeds of this tax are to be distributed as follows:
- 18%, up to $36 million, to increase spending on existing health-related programs including Medicaid, children’s health care, tobacco education programs, and disease prevention and treatment
- 27% for research grants to study tobacco-related health issues
- 16% for education and prevention, and other programs to encourage people to stop using tobacco
- 14% for grants to improve health, find employment and prevent homelessness for veterans
- 10% for grants for child and adolescent mental health and substance abuse prevention and treatment
- 10% for construction or improvements to community health centers or providers that serve predominantly low income patients
- 5% for student loan repayments and training for health care professionals working in rural or underserved areas of the state.
Amendment 72 requires the General Assembly to maintain the 2016 funding levels for the programs that already exist, and to use the new tax revenue to expand the existing programs. In other words, to grow government and have this spending locked into our state Constitution.
Many physicians and businesses support this tax increase. Some supporters may actually believe that raising the price of a pack of cigarettes will reduce demand (yet seem to ignore this economic law when it comes to minimum wages) and reduce smoking, especially among children and teenagers. Other supporters probably expect some economic benefit from this tax in the form of grant receipts or business from grant recipients.
Like its cousin Amendment 69, Amendment 72 contains language that would exempt it from TABOR, meaning that there would be no spending limits related to this tax.
I tend to favor the arguments against this proposed amendment, which include the fact that only 16% of this tax goes to smoking prevention, with the rest going to various progressive pet projects and goals.
According to my research, most of the programs outlined don’t exist yet and there are no existing written guidelines for awarding the 51% that is allocated to various types of grants. This gives the state a blank check for millions of dollars in new spending with little oversight or guidance. Since this will be locked into the state constitution, there will be little if anything that the General Assembly can do to control this spending and correct the inevitable abuses and fraud associated with many government programs.
The sad fact is that Colorado has already received about $1.6 billion from litigation settlements with the tobacco companies that could have gone to tobacco prevention and treatment, but our state government has spent most of that money on unrelated government programs. Thinking that the proceeds from this tax would actually go to tobacco prevention and treatment is an exercise in naiveté.
Another reason this tax should be voted down is that it is highly punitive to low-income tobacco users. Studies show that most tobacco users are low income individuals who cannot absorb a high tax increase of this nature. Because of the highly addictive nature of tobacco products, most users will continue using tobacco regardless of the price. For more affluent tobacco users, higher prices will make no difference.
Finally, from a moral perspective, the purpose of government is to protect the rights of individuals. Taxing a legal product and using the proceeds to fund various programs – none of which are the proper function of government – is immoral in and of itself.
As an ex-smoker, nobody despises cigarettes and cigarette smoking more than I do. This tax in just not the right way to go about reducing the incidence of tobacco use in our state.
For all these reasons, I urge a “NO” vote on Amendment 72. Just say “NO” in NOvember.
By Richard D. Turnquist
October 22, 2016