“Republicans in the House said the tax cut to $1.68 per pack will spur business at stores along the state’s borders. Critics said it will cost the state $12 million a year in revenue, and that tobacco companies will pump up prices by a dime to negate the break meant for smokers.”
Senate negotiators initially opposed the cigarette tax cut and a bill to lower the cigarette tax rate was voted down in a Senate committee earlier this session. However, House Speaker William O’Brien (R) reportedly “insisted on the tobacco tax cut,” and “leaned on his team to get the measure included in the budget, after negotiators had already agreed to shelve the plan.”
While house negotiators fought to include the tobacco tax cut in the budget, New Hampshire legislators were faced with a $42.5 million budget deficit. Yet “the budget also raises no taxes or fees,” according to Senate Finance Committee chairman Sen. Chuck Morse, R-Salem.
So how did negotiators balance the budget?
“The budget cuts $115 million from charity care aid for hospitals and close to half the state’s support for the university system. (It takes) steps toward privatizing the corrections system, cuts pensions for some, and (results in) higher health care costs for retirees…The plan (also) eliminates nearly 1,100 state government positions. (As a result), more than 200 active workers will get laid off.”
So state negotiators felt it was more important to cut cigarette taxes than help its citizens pay for medical care or education? Those are sad priorities.