NEIGHBORHOOD STORE ASSOCIATION
Spring 2007
Vol. 9 No. 1
Talking Points for HB 2201 — Healthy Kids Program and proposed Tobacco Tax Increase
ONSA members and other neighborhood storeowners are strongly encouraged to contact members of the Oregon House of Representatives by phone or by e-mail. Explain to the legislators (or their staffers) exactly how HB 2201 and the proposed tax increases will affect your business and your livelihood. Talking points may include:
• New tobacco taxes are not a sustainable source of funding for the Healthy Kids Program. In fact, the Legislative Fiscal Office’s official analysis of the Governor’s proposed budget states: “A third budget policy consideration is the sustainability of the Healthy Kids Plan beyond the 2007-2009 biennium. The state share of the Healthy Kids Plan is funded with tobacco tax –a source of revenue, which has not increased significantly each year, unless the tax rate is increased… Can the budget for Healthy Kids be sustained over time with tobacco tax revenue while health care costs continue to rise?”
• It is not fair to require the 1/5 of Oregonians who smoke to provide health insurance for all Oregon children. Smokers as a class generally have lower incomes than the majority of Oregonians. The Healthy Kids Program would require smokers to pay for health insurance for children in families earning up to $70,000 per year. If Oregonians believe the state should provide health insurance to all children in the state, all Oregonians should help pay for it – not just a politically unpopular minority.
• The Governor’s Budget proposes to spend 20% more in the 2007-2009 biennium than the state spent in the 2005-2007 biennium. Lawmakers should not increase taxes when the state is already planning to spend 20% more than it did two years ago. Few Oregonians have seen their incomes increase by 20% in the past two years.
• Less than 44% of the proposed tobacco tax increases would go to the Healthy Kids Program. The remaining 56% of the proposed tobacco tax increases would go to fund other programs that are unrelated to providing health insurance to children.
• The proposed tobacco tax increases are huge. The proposed cigarette tax increase of $0.845 per pack is a 75% tax increase. Increasing the tax on other tobacco products from 65% of the wholesale price to 95% of the wholesale price is a 46% tax increase. These tax increases target Oregon’s low-income citizens and will hurt small neighborhood stores.
• The state is anticipating the tobacco tax increases will generate $181.7 million in new revenue over the next two years. This estimate is exceedingly high and does not appropriately account for the fact that many consumers will purchase cigarettes in other states or through black market sources if the proposed tobacco tax increases are adopted.
Inside:
Cigarette Tax heads the list of 2007 Legislative Issues
Store Owners—
Does Oregon’s Pesticide Use Reporting System Apply to You?