Tobacco tax cut is misleading

In the play by Tennessee Williams, "A Cat on a Hot Tin Roof," there is a scene where the character, Harvey "Big Daddy" Pollitt, annoyed with the lies surrounding him, uttered these words: "There ain't nothin' more powerful than the odor of mendacity!" With all the demagoging I have read in the papers concerning the reduction of "10 cents a pack in the cigarette tax," I must say I do smell something in the air that is not cigarette smoke but indeed mendacity.

Whenever I discuss this topic I always inoculate myself by saying I have never smoked and have no idea why anyone smokes. There is no question this is a bad habit that is not good for one's health. No one can refute those facts. The recommendation by the Ways and Means Committee (WMC) to lower the tax by 10 cents a pack was simply driven by the need to restore falling cigarette tax revenue. Being a state rep. on the WMC I had a front row seat to the discussion. Let's explore the facts:

1. The cigarette tax increased 98 cents a pack from 80 cents in FY 2007 to $1.78 in FY 2010.

2. The cigarette tax revenue did increase during that period to a point in which it now represents the fourth largest revenue stream behind the state-wide property tax, business profits tax (BFT), and the business enterprise tax (BET).

3. In FY 2011 the actual cigarette tax revenue dropped $7.7 million from FY 2010 levels indicating that we hit the "tipping point" in which the increased tax resulted in reduced total revenue. That is correct. Revenues are down because the tax rate was increased too much.

4. In the WMC we heard testimony from grocery stores, convenient store chains, and "mom & pop" convenient stores from all along the Massachusetts, Maine, and Vermont border. They indicated a drop in cigarette sales because the price per pack differential between New Hampshire and the border state prices has been reduced (especially with Maine). This has resulted in border state customers not coming across the border to buy cigarettes as they once did. The problem is when these lost customers came across the border they bought many other products including gasoline (18 cents per gallon gasoline tax), lottery tickets (lottery revenue), alcohol (lost profit from our liquor stores that goes to the general fund), and other items increasing profit and the number of employees in jobs (impacting the BPT revenues and BET revenues respectively).

5. In the WMC we heard testimony from an individual familiar with the cigarette distribution center in Contoocook that distributes cigarettes in New England. He said cigarette sales were up everywhere in New England with the exception of New Hampshire. His message was the citizens in N.H. weren't smoking any less because of the increased taxes, but smokers from border states simply are not coming to N.H. to buy their cigarettes as they once did. Instead they are buying cigarettes in their home states at record numbers, especially in Maine. This is strong evidence these tax increases have not reduced smoking in N.H., but simply reduced cross-border sales.

6. There was a study conducted by two economics professors at Southern New Hampshire University indicating the reduction in the cigarette tax would lead to $11.8 million increase in revenue. Since I know something about multivariate analysis I sat down with the two professors to confirm their math was correct. Their overriding conclusion was the calculus for N.H. is different than other states because of our strong border state sales.

7. There were all the phone calls, emails, and letters from older citizens saying the cigarette tax increases in recent years were hurting them. I engaged many of these folks who indicated to me at their age they did not want to give up smoking. I even tried to talk them into quitting. The bottom line is the cigarette tax is a very regressive tax hurting our elderly and the poorest among us.

8. The WMC heard testimony from representatives from organizations such as American Heart Association and the American Cancer Society presenting all that is bad about smoking. It is safe to say all on the WMC were already familiar with their arguments and facts. We are not the policy committee who normally would hear this type of testimony; our charge is to focus on the revenue ramifications of this tax. At one point, I suggested that their organizations file a bill at the national level to ban cigarette sales totally and told them I would support it. Then I paused and said the dirty little secret is that every state is addicted to the cigarette tax. The hypocrisy of the whole discussion is that those who want even higher taxes on cigarettes for health reasons would not want to see the loss of all tobacco revenue because of the social programs it funds.

9. The House, Senate and governor in a bipartisan fashion repealed the 10 percent gambling tax this session. There are those who say gambling is an addiction and thus a health risk. So why was there no outcry against the repeal of the gambling tax by the same folks demagoging the cigarette tax reduction? From a WMC view, both the gambling tax and increases in the cigarette tax resulted in lost revenue to the state in FY 2010, through reduced lottery sales and gaming revenues, as well as, from lost cigarette sales to the border states. The same basic economic principal was in play, but resulted in selective outrage.

I have already heard from store owners thanking the Legislature for this tax reduction just as I have heard similar thanks concerning the elimination of the gambling tax. These moves have been good for business which is good for keeping jobs within our state and an increased flow of revenue to the general and education funds. We on the WMC will keep a close eye on the impact of both these actions which were designed to help business and to increase state revenue.

As for the children smoking argument, my response is, "Let's not confuse tax policy with good parenting." When my children were in high school, the cigarette tax was 37 cents a pack. Cigarettes were very cheap then, but my children never smoked. As parents, we taught our children well. Society must rely on parents to properly guide children and not defer to tax policy to magically do the job of protecting its children from any unhealthy practices.

Patrick Abrami is a resident of Stratham and serves as District 13 state rep. for Exeter, Stratham, North Hampton.

Excise duty hike on cars, tobacco coming this week?

Concerned over the expected shortfall in tax revenues, the Finance Ministry is likely to take a call on revising excise duties on cars and tobacco-related products this week. Excise duty on both the products was not revised in the Union Budget this year.

A highly-placed official source told Business Line that “various suggestions have come on this (revising the excise duty), but no final view has emerged. The Finance Minster is expected to decide once he is back from the UK.”

However, sources said that the task was not an easy one. As the rate of growth of manufacturing and capital goods is on a decline, any duty hike would affect demand, they said. There is also the fear of a fall in investment demand.

The demand for tobacco products, such as cigarettes and pan masala, is price inelastic, said the sources. As the duty was not revised in this year's Budget, the option is there. However, there is a technical glitch. The duty on tobacco has reached near the tariff-line level, and hence the Finance Ministry would have to seek Parliament's approval for any further increase.

However, hiking the duties of cars will not be that easy, said the sources. The automobile industry has been lamenting about the hard times, with sales growth slowing and costs rising.

But there are some suggestions, such as raising the duty on diesel-run and high-end cars. Small petrol cars could be spared, the sources said.

TAX TARGETS

Though the Finance Ministry is confident that it will meet the tax targets, there is severe pressure on resources. Owing to the lowering of duties on crude, petrol and diesel, the Ministry had estimated a revenue loss of Rs 24,000 crore (after deducting States' share of 32 per cent) for the remaining nine months of this fiscal. Now, with the falling price of the Indian crude basket, it is feared that the Customs duty collection may decline further.

In addition, the Government may have to provide additional subsidy on account of the Food Security Bill and to government-owned oil marketing companies. Even after the price hikes and lowering of duties, oil marketing companies expect to incur a loss of Rs 43,000 crore for the quarter ended June 30, 2011.

Michael Bloomberg got New Yorkers to quit smoking. Can he shut down coal?

He got New Yorkers to stop smoking and give up trans fats. Now maybe he can convince Americans to see coal as a danger to public health – at least Michael Bloomberg says that is the idea behind his $50m (£31m) gift to the Sierra Club's Beyond Coal campaign.

What it's not about is making an argument based on climate change.

"If you don't survive today, you are not going to be around for tomorrow," he told me on Thursday, soon after announcing the gift from his philanthropic foundation.

"I don't think there is any question that we are doing damage to the global environment but that gets you into an argument that is not necessary, and that the public has trouble thinking about," he said.

Bloomberg has proven his commitment to environmental causes. As mayor, he has championed bike lanes and green retrofits of office towers. As a philanthropist, he pledged $20m (£12.5m) earlier this year to help the C40 global mayors group which is working to reduce greenhouse gas emissions in 40 cities around the world.

But like other leaders on the environment since the rise of the Tea Party he is strategically avoiding mention of climate change. In Bloomberg's case, he argues distant threats are not great motivators.

The effects of air pollution from coal burning plants are evident now, and they are simpler to explain. Soot particles trigger asthma attacks and cause breathing problems; mercury can cause neurological defects, the mayor said.

"This is not science saying what is going to happen years from now as the oceans rise and the planet warms," he said. "This is: this year we are going to kill another 13,000 Americans."

So what are the chances of actually meeting the Bloomberg and Sierra Club goal of shutting down about 30% of America's coal plants?

Pretty good, actually.

It's worth remembering, nine years on, that Bloomberg's push to ban smoking in bars was controversial at the time.

"When we passed the smoking ban in New York City I was told that nobody from England or Ireland was ever going to come to be a tourist in New York again, and that everybody would leave New York to eat and drink, and that it would be a disaster for the food and drink industry," Bloomberg said. "But the truth of the matter is, every country in Western Europe followed our lead."

His anti-smoking effort also proved effective, bringing down smoking rates in New York even as they stayed stubbornly steady in the rest of the country.

About one in five (21.6%) of New Yorkers were smokers when the ban went into effect in 2002. The figure fell to 15.8% in 2009 and the city is hoping its combination of smoking laws, high cigarette taxes, nicotine patch giveaways will bring that number down to 12% or about one in eight New Yorkers by 2012.

Now here is the base line for coal.

Coal still supplies nearly half of America's electricity. The latest forecast from the Energy Information Administration suggest it will continue to supply 43% of electricity even in 2035.

But - new construction of coal plants is at a standstill. More than 150 planned coal power plants have been abandoned or blocked in the last decade, according to the Sierra Club.

About 10% of the 600 or so existing coal plants are scheduled to be retired, and the Environmental Protection Agency is finally rolling out new regulations that will force coal plants to install new, cleaner burning technologies, or shut down.

Which is where Bloomberg and the Sierra Club come in. Bloomberg hopes the scale of his gift, and the high-visibility launch of the campaign on a boat in the Potomac, will set the same example as New York did in changing minds on coal.

He is not trying to get the White House or Congress to act. In choosing the Sierra Club, the largest membership-based environmental group in the US, Bloomberg put his money on grassroots organising.

The campaign will use the courts to enforce existing environmental regulations, and hopefully shut down the oldest and dirtiest plants.

They will also push state governments to adopt renewable energy standards that require power companies to generate a portion of their electricity from wind or solar.

And they will try to further mobilise public opinion against the destructive practice of mountaintop mining removal. Opposition to coal is growing.

Lester Brown of the Earth Policy Institute has been arguing for a number of years now that opposition to coal has reached critical mass.

"What began as a few local ripples of resistance quickly evolved into a national tidal wave of grassroots opposition from environmental, health, farm, and community organizations," Brown writes. "Closing coal plants in the United States may be much easier than it appears."

Maybe, it just needs a mayor on a mission to push coal over the edge.

1.2 million contraband cigarette sticks seized

Police have seized over 60,000 packets of contraband cigarettes following a three-day crackdown on a distribution network operating in Hougang, Bedok and Yishun.

Three locals and a Chinese national were arrested in the sting operation between July 5 and 7. The contraband amounted to a total of 1.2 million sticks, with tax and duty evasion exceeding $450,000.

Three vehicles - a saloon car and two goods trucks - used by the syndicate members were also seized by authorities.

Singaporean Ang Wee Koon, 37, was the first to be arrested. On July 5, police uncovered 36,240 packets of duty-unpaid cigarettes in his truck in Bedok. Ang has been charged and sentenced to 21 months of jail.

After a follow-up surveillance operation on July 6 and 7, three others - Chinese national Chen Zushun, 38, Mohamed Shah bin Jantan, 50, and Tan Boon Kiat, 55 – were arrested.

Chen was found with 23,773 packets of duty-unpaid cigarettes in his Yishun flat. Police observed him collecting 10 boxes of contraband cigarettes from Shah and Tan, who had made a delivery to the carpark below his housing block.

Shah and Tan subsequently drove off in their goods truck and car to a Hougang carpark. They were nabbed after police witnessed Shah handing over a box of cigarettes to Tan.

Shah has since been charged and sentenced to 20 months' jail. Court proceedings are still ongoing for Tan and Chen.

Under the Customs Act and the GST Act, repeat offenders can

Cigarette packs to feature visceral warnings

When smokers pick up a pack of cigarettes next fall, they may be shocked to see images of corpses and cancerous body parts in an effort government agencies are hoping will help them to kick their addiction.

The usual labels with small warnings of the potential risks of smoking — including harming unborn children or causing cancer — will be super-sized with graphic warnings, according to the Food and Drug Administration.

The FDA announced last month new, larger warning labels will be on packs of cigarettes sold in the U.S., starting in September 2012. The new mandatory labels will have visual warnings showing potential outcomes of smoking, such as photos of cancer victims, diseased lungs, mouth cancer and tracheotomies.

Next fall’s revamped warnings mark the first change in content in warning labels in 25 years.

The Centers for Disease Control and Prevention found health warnings on cigarette packs prompted smokers to think about quitting and prominent, pictorial warnings are most effective in communicating the health risks of smoking.

Though the FDA is hoping the new labels will hit a nerve with smokers and help them fully understand the potential consequences of their actions, Linda Walston, manager of Tobacco Road Outlet on North Herritage Street, said they probably won’t see much of an impact.

“I don’t know if it will make a big world of difference, as far as people smoking,” Walston said. “It’s just one more thing to give people conversation about.”

Walston said people who smoke already know all the risks, but other potentially harmful products should deserve the same treatment.

“Are they going to put crashed cars on beer bottles, headless people where some drunk man ran into somebody and chopped their head off because they were drunk driving?” Walston asked. “If they’re allowed to do something like that, then somewhere down the line they ought to put crashed automobiles on beer bottles.”

Locals may need the extra push to quit the habit, with 58.8 percent of high school students having smoked in 2007, according to that year’s Lenoir County Health Assessment. The study also found 16.3 percent of Lenoir County mothers smoked while pregnant from 2002-2006, about 4 percent higher than the state average.

If the pictures on the packs aren’t enough to prompt people to quit, Constance Hengel, director of community programming and development at Lenoir Memorial Hospital, said the hospital offers four methods to assist in stopping the habit.

Hengel said those who smoke also risk their heart health, with heart disease being the biggest killer of Lenoir County residents.

“Lenoir Memorial offers a number of tobacco cessation programs,” Hengel said. “Smoking is the No. 1 preventable risk factor for heart disease, and we hope to help persons who are ready to quit.”

Fake cigarettes sold to children in Middlesbrough

CHILDREN as young as seven are being sold fake cigarettes at dozens of “tab houses” in Middlesbrough, officials have warned.

The counterfeit fags pose a greater threat to smokers’ health than the real thing, consumer watchdogs say.

Middlesbrough Council’s trading standards team has subjected counterfeit cigarettes and tobacco to chemical analysis.

The tests have shown the fake tobacco often contains an even more damaging cocktail of chemicals than their shop bought counterparts.

Checks revealed the counterfeit cigarettes seized contained an average of 63% more tar than genuine products - with figures as high as 130% being recorded.

You want to smoke original cigarettes? Than buy discount cigarettes online.

Levels of carbon monoxide given off by the fake cigarettes were also significantly higher - samples produced nearly 30% more on average reaching a high of 80%. Tests for other harmful substances showed the fakes also contained up to three times as much cadmium, seven times as much arsenic, and 10 times as much lead as legal alternatives.

Over the last year, officers have raided nine properties and seized a large quantity of cigarettes and tobacco.

John Wells, the council’s Community Protection Department operations managers, said Trading Standards believed there were more than 50 “cigarette houses” in the town - adding Trading Standards believed children as young as seven were customers.

Police seek robber who held knife to clerk's throat, stole cigarettes

Officers went to the Cash N Carry at 2901 N MacArthur Blvd. about 9:30 p.m. July 9. Sgt. Jennifer Wardlow said the clerk was behind the counter when a man walked in, went behind the counter and put a knife to her throat.
The robber demanded cash from the safe, but the clerk didn't have access to it. The man then demanded cigarettes instead, specifically asking for the Newport brand.
The man held the clerk's arm and held a knife at her throat while stuffing several cartons into a white pillowcase.

Buy cheapest cigarettes from exclusive tobacco shop.
After gathering several cartons of cigarettes estimated to be worth $300, the man fled on foot, police said. The clerk told officers she thought he ran across MacArthur and possibly into the apartments on the east side of NW 29.
The man was wearing pantyhose or a mask over his face, police said.

Blackburn with Darwen health chief in car smoking ban call

BLACKBURN with Darwen’s top health expert has called for a ban on smoking in cars when children are present.

Discussions have begun in Parliament to decide whether it should be made illegal to smoke in a private vehicle that is carrying children.

And Dominic Harrison, director of public health at Blackburn with Darwen Care Trust Plus, believes the move is justified.

He said: “The effects of second hand smoke have always been a real concern and major health risk, especially in children.

“Smoking around children and young people in enclosed spaces exposes their developing lungs to toxins and can trigger asthma attacks, bronchitis, middle ear infection and hearing impairment, as well as cot death.”

England’s smoke free law banned smoking in enclosed public places such as offices, pubs and restaurants.

The 2007 legislation was introduced to help reduce the risk of serious health problems for non-smokers.

There are more than 4,000 different chemicals in tobacco smoke, many of which are toxic and damaging to health.

Experts say being exposed to second hand smoke can increase a non-smoker's risk of getting lung cancer by 24 per cent and heart disease by 25 per cent.

Doctors believe passive smoking triggers 22,000 cases of asthma and wheezing in children every year.

The Royal College of Physicians said passive smoking resulted in 300,000 extra child visits to GPs in the UK, with 9,500 being admitted to hospital for problems such as asthma and bacterial meningitis.

Anti-smoking body Smoke-free North West believes the region is responsible for at least 30,000 of these smoking-related illnesses and 1,000 hospital admissions.

Governor Won't Repeal Smoking Ban in Restaurants

Despite opposing the ban last year, Gov. Scott Walker said he now favors the ban as a reasonable restriction on restaurants and bars.
Gov. Scott Walker said today he will not repeal the state's smoking ban in restaurants and bars as it reaches its one-year anniversary.

Walker originally opposed the ban as unnecessary government restrictions on private businesses, but today he said time has shown it has not been unduly harmful.

“Although I did not support the original smoking ban, after listening to people across the state, it is clear to me that it works," Walker said. "Therefore I will not support a repeal.”

The ban went into effect July 5, 2010, after being signed in 2009 by then-Gov. Jim Doyle.

In Brookfield, the smoking ban has prompted many restaurants and bars to seek city approval for new or expanded outdoor seating. Aldermen loosened their ordinances to allow outdoor seating at restaurants that abut residential development — something that previously was prohibited.

Malawi Tobacco Earnings Decline 72% to $73 Million in Season, Zodiak Says

Malawi’s tobacco earnings declined 72 percent from the start of the selling season to July 1 compared with a year earlier, Zodiak Broadcasting Station reported, citing Bruce Munthali, chief executive officer of the Tobacco Control Commission.
The southern African nation has sold 72 million kilograms (158 million pounds) of the leaf since March 14 compared with 130 million kilograms during the same period last year, the Lilongwe-based broadcaster cited Munthali as saying.