US STATES TURN TO 'SIN' TAXES TO FILL BUDGET GAPS

Source: Reuters
Date: Wednesday, January 23, 2002
Author: Chris Sanders
URL: here

Starved of revenues amid the US recession, several states have raised or
are considering increases in ``sin'' taxes on cigarettes and alcohol in
their latest strategy to address a hefty drop in tax receipts and growing
health-care costs.

Having dipped into rainy day funds, cut education budgets deeply and done
just about everything else they could short of raising taxes, many state
lawmakers are now gearing up for fights over tax increases with the
well-oiled and powerful cigarette and alcohol lobbyists in their state
capitals.

At least 16 states including Massachusetts and Illinois want to increase
taxes on a pack of cigarettes, according to Matthew Myers of the Campaign
for Tobacco-Free Kids in Washington, DC.

``Anything that'll get me to quit smoking is OK by me,'' said New Yorker
Chris Moore, a smoker shivering outside a Times Square office building.

Even though the higher cost will reduce his smoking, Moore admits to
avoiding New York's high prices by buying his cigarettes in New Jersey. .
.

Nebraska state Sen. Bob Wickersham introduced two bills in early January
that would raise taxes on both cigarettes and alcohol to bring in an extra
$18 million to the state.