Missouri Rejects Tobacco Tax Increase

Voters in Missouri rejected a measure that would have raised the state’s tobacco tax, which is the lowest in the United States. The proposal would have increased the tax from 17 cents to 90 cents per pack.

With 92 percent of precincts reporting, 51 percent of voters rejected the proposal, The Kansas City Star reports. This is the third time the state has voted against a tobacco tax increase, the article notes.

Big tobacco companies spent millions of dollars in 2002 and 2006 to oppose a tobacco tax increase. This time, they did not oppose it, because the measure would have removed a loophole that allows smaller cigarette makers to get back money they paid into a state fund designed to offset costs associated with smoking-related illnesses.

The measure was supported by a coalition of educators, whose schools would have received millions of dollars from the tax increase. Tax revenues from the measure, known as Proposition B, would have been used for public schools, higher education and tobacco prevention and cessation programs. A state auditor’s report estimated the measure would have generated between $283 million and $423 million each year.

Opponents of the measure, including the Missouri Petroleum Marketers and Convenience Store Association, said the big tax increase would eliminate the state’s competitive edge in the tobacco market, resulting in the loss of tens of millions of dollars in sales tax revenue.