Lawmakers stalemate on cigarette tax hike

March 24, 2009



JACKSON -- The House and Senate still haven''t agreed on a cigarette tax increase as negotiators face a Wednesday deadline to find a compromise or let the bill die. 


While the two sides are coming closer together, it''s not enough to form a legislative consensus. 


"I''m not encouraged at this point," House Ways and Means Chairman Percy Watson, D-Hattiesburg said Monday evening as negotiators continued their stalemate. 


Senate negotiators agreed to increase the cigarette tax to 60 cents a pack -- up from the 49 cents senators initially adopted -- while House bargainers offered to lower the House''s $1 plan to 90 cents a pack. 


However, Watson said the Senate''s offer -- projected to generate about $104 million a year -- doesn''t produce enough revenue. 


"Our general fund needs money and we need money desperately," said Watson, who noted the 90-cent tax proposed by the House would generate about $165 million a year. 


Senate Finance Chairman Dean Kirby, R-Pearl, said the Senate can''t go any higher than 60 cents. 


"I think the Senate has gone about all it can go right now," said Kirby, who noted many senators might not even accept the 60-cents-a-pack tax. "I''m not sure that we could even pass what we offered today." 


Mississippi''s current cigarette tax is 18 cents a pack, the third-lowest state rate in the country. 


The stalled negotiations on the cigarette tax come as the Legislature faces a self-imposed deadline Wednesday to have revenue and budget bills ready for final votes in the House and Senate. However, lawmakers are planning to extend the deadline for the budget because too many questions remain about the federal economic-stimulus funds Mississippi is getting. 


House Appropriations Chairman Johnny Stringer, D-Montrose, said he expects the House and Senate will adjourn within a week and return in May. "Hopefully, we''ll recess and come back to do the budget. I think it''s a wise move to do that," Stringer said. 


However, he did say the House and Senate should agree on a cigarette tax increase now before recessing. Suspending the deadline requires a 67 percent vote of the House and Senate, and there could be enough cigarette-tax opponents to block an extension of the deadline for revenue bills. 


The federal cigarette tax is increasing on April 1 from 39 cents a pack to $1.01.