- The Washington Times - Wednesday, February 17, 2016

ANNAPOLIS — Democratic lawmakers are at odds over tobacco policy — with some pushing to increase taxes on cigarettes and smokeless tobacco, and others trying to reduce taxes for premium cigars. Both bills face uphill battles to win over lawmakers.

Delegate Eric G. Luedtke touted his legislation as a health-conscious measure to help cut smoking rates. It calls for a $1-a-pack tax increase on cigarettes, smokeless tobacco, snuff and cigarillos, and would set aside $21 million a year for smoking prevention programs.

“The reality is, as a taxpayer and a nonsmoker, you’re paying to subsidize the health care costs of all the smokers in terms of Medicaid costs, Medicare costs,” said Mr. Luedtke, Montgomery Democrat. “That doesn’t make sense. All the tobacco tax does is asks smokers to pay their own way.”

Fellow lawmakers said they agreed with the intent of his bill, but questioned the approach.

“I’ve always supported the increase. I know the effects of smoking and we need to stop it. But when do we stop taxing?” said Delegate Carolyn J.B. Howard, Prince George’s Democrat. “This is, what, the third tax we’ve had?”

Maryland’s cigarette tax was first increased in 1999, and then again in 2007 to the current rate of $2 per pack. In 2012, the legislature started taxing little cigars, or “cigarillos,” and smokeless tobacco.

Vincent DeMarco, president of Maryland Citizens Health Initiative, said the taxes have helped tobacco use among children by about 40 percent and among adults by about 30 percent.

“That’s twice the national average,” Mr. DeMarco said.

Mr. Luedtke and state Sen. Richard S. Madaleno Jr., Montgomery Democrat, dropped premium cigars from the legislation to improve its chances for passage. Opponents had argued that including cigars would punish tobacco retailers without lowering youth smoking rates since teenagers can’t afford luxury cigars.

Conversely, Delegate Sheila Hixson and state Sens. John C. Astle and Edward E. DeGrange introduced a bill that would lower the tax on premium cigars from 15 percent to 7.5 percent.

“The do-gooders say we need to tax this because it gives us a revenue stream to do things, but what it does is decrease the sale but it increases the illegal importation of tobacco products into the state,” said Mr. Astle, Anne Arundel Democrat. “The smugglers start loading up their trucks because the larger the tax, the larger profit margin they get from sales.”

Cigar retailer Paul Spence said Maryland’s high taxes on cigars have hurt small businesses. His shop — W. Curtis Draper in Bethesda — has become a “tasting center” where people find what they like then buy it in other states or online where the prices are lower.

“We do this because we enjoy the flavor, the product, not because we’re addicted,” Mr. Spence said. “It’s a pastime. It’s a hobby. And sometimes those who can do without it, they will price shop.”

The two tobacco bills have revealed a Democratic rift.

“There are people who have different ideas of where we should be going on tax policy,” Mr. Madaleno said. “I’m sure Senator Astle is going to talk about helping the small cigar stores, and I don’t think that’s a business we should be incentivizing.”

Mr. Astle said he “would never support an increase on taxes on tobacco.”

“I don’t think it’ll go anyplace. I don’t,” he said. “The liberal left, they’d like to see it. I’m a Democrat too, but I’m not on the liberal left. I’m on the moderate side.”

A spokeswoman for Republican Gov. Larry Hogan said he would consider the cigar tax decrease if it reaches his desk, but the tax increase would not win his approval.

“Governor Hogan has made it very clear that any piece of legislation involving a tax increase is a non-starter,” said spokeswoman Shareese Churchill.

The bills also face difficulty in winning over members of the committees tasked with considering them. Ms. Hixson chairs the committee that considered the tobacco tax increase, and Mr. Madaleno is vice chair of the panel that considered the cigar tax decrease.

Mr. DeMarco said Ms. Hixson historically has supported tobacco tax increases, and he hoped she would lend her support to the measure once again. But other legislators show less willingness to consider opposing bills on tobacco policy.

Mr. Luedtke acknowledged it is going to be a hard sell.

“It’s a tough environment for a tax bill in Maryland, despite all the arguments for it,” he said.

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