Tobacco Taxes

An organization that wants to raise the tobacco tax and lower the sales tax called on legislators to support the idea today, before the bill is heard in a house committee next week. Tennesseans for Fair Taxation spokesperson Phil Schoggen says the sales tax on food unfairly targets low-income people who end up spending a higher percentage of their income on food. Schoggen says Tennessee’s tax is one of the lowest rates in the nation. 

 “20-cents per pack.  A measly 20-cents on a pack of cigarettes.  The national average is 96-cents.   

The bill would raise the cigarette tax 43-cents and lower the state food tax rate 3-percent.  This year, Senator Rosalind Kurita is sponsoring her own bill to raise the tax by 71-cents without affecting the sales tax rate. Tobacco tax bills have traditionally died in the agriculture committees of the house and senate but the idea may be gaining traction after house Speaker Jimmy Naifeh said last week he’s interested in the issue.  Governor Phil Bredesen has also touted the idea as a long-term funding source for his health insurance proposal, Cover Tennesse. 


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