Tax cigarettes for health care
Given the sad economy, increasing South Carolina’s cigarette tax offers lawmakers the best opportunity to get their hands on a pot of new money next fiscal year. The Legislature should hike the measly 7-cent tax — the nation’s lowest — and use it to support health care for needy South Carolinians.
Already, new cigarette tax proposals are emerging. State Superintendent of Education Jim Rex, a Democratic gubernatorial candidate, wants a $1.27-per-pack tax hike, with proceeds split between keeping teachers on the job and bolstering Medicaid.
The Legislature should use the tobacco tax strictly for health care, recognizing the burden that tobacco use puts on the state’s medical system. Raising the tax also would have the beneficial result of reducing the number of people who smoke. And a portion of the revenue could be used for cessation programs aimed at teens.
The House of Representatives last session approved a 50-cent per pack tax hike on cigarettes and directed that the proceeds be used to establish a health insurance program for the working poor. That’s still a good idea.
But there’s another use that will help more people in South Carolina who need health care, particularly while these hard times continue. About a fourth of the state’s residents are eligible for Medicaid, but South Carolina’s funding woes put Medicaid programs at risk of being sharply cut.
The state already is depending on federal stimulus money to keep its Medicaid programs operational.
A 50-cent cigarette tax would generate $150 million and make the state eligible for four times that amount in federal aid.
“If we don’t put the cigarette tax higher, Medicaid is sunk,” says Sue Berkowitz, director of the Appleseed Legal Justice Center, an advocacy service for the state’s poor residents.
Consequences of South Carolin’s struggling economy include reduced revenue to the state and increased joblessness, now at a record 12.6 percent. The higher the unemployment rate, the more residents are eligible for poverty-based programs, including Medicaid.
If the Legislature wants to get the House health care insurance program under way, it could raise the cigarette tax higher than initially envisioned (the national average is $1.34 per pack).
But legislators would do better this year to dedicate new revenue from a higher cigarette tax to the troubled Medicaid program.
The increasing number of South Carolina’s struggling residents need the help.
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