It’s like déjà vu for a second time -- Congress is preparing to pass a bill to increase the federal excise tax on cigarettes. Except now, with President-elect Barack Obama waiting in the wings to take over the Oval Office, it seems this undeniable nightmare for c-store retailers will turn into a stark reality.
The House voted and passed a bill two weeks ago to expand the State Children’s Health Insurance Program (SCHIP) by levying a hefty 61-cent increase on the federal tax on cigarettes. The Senate, meanwhile, passed a similar bill through a financial committee. That bill is currently in debate before the full Senate, with published reports stating a vote could come later this week.
But wait -- hasn’t this happened before? Twice, in fact. In August 2007 the Senate approved an SCHIP expansion bill in the face of veto threats by President George W. Bush, following approval in the House (See "A Bad Week for Tobacco," CSNews Online). However, President Bush vetoed that bill in early October 2007, stating it was flawed and would raise taxes, and allow adults and higher-income families onto the plan. And after a similar measure (with the same flaws) was crafted and passed by Congress, he vetoed that bill in mid-December.
Under an Obama administration however, it appears the third time will indeed be the charm. An Oct. 18, 2007 statement on Obama’s campaign Web site -- issued after the first veto by President Bush -- declares his disapproval of the veto and how he, as President, would sign a universal health care bill by the end of his first term. It is clear that Congress will see no more vetoes of this measure come Jan. 20, 2009.
There’s a reason why Congress is determined to pass a bill that would put the business of all tobacco retailers in jeopardy -- especially those c-stores who rely heavily on the traffic and profits that cigarettes generate. It’s the children. In the height of debate on this issue, when the House tried to get a veto-proof majority for the bill, advocates for the bill vilified opponents by ostentatiously alleging they were against the innocent, uninsured children of this nation. One SCHIP supporter at the Rockridge Institute presented an interesting image of a classroom full of sick children.
C-stores and other tobacco retailers don’t have much of a chance with lawmakers when they are put alongside a grade school child with the sniffles. In some lawmakers’ eyes, convenience stores sell those deadly cigarettes, the obesity-causing soft drinks and trans-fat-filled hot dogs, and, of course, reap serious chunks of change by gas-price gouging each time the threat of a hurricane in the Gulf Coast makes news. So SCHIP-supporting lawmakers probably think higher tobacco taxes don’t matter that much to this industry.
The realities of this issue -- and this bill -- are warped. But it’s a reality c-stores are going to have to face, and sooner rather than later, it seems.
What do you think?
It's a bad idea to hang the funding of important legislation on a declining commodity, and only one industry.
Posted by: Mary Szarmach | January 27, 2009 at 02:08 PM