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University of Hawaii officials are hoping a bill in the state Legislature that would raise the excise tax on cigarettes and little cigars will help the UH Cancer Center stay afloat despite recurring budget deficits.
Senate Bill 2690 originally proposed increasing the tax to 20 cents a cigarette from 16 cents, bumping up the state tax on a package of 20 cigarettes to $4 from $3.20. But lawmakers have since taken out the amount of the increase, half of which would be earmarked for the Cancer Center and half for the state Department of Health’s Chronic Disease Prevention and Health Promotion Division to fund smoking cessation and education programs.
UH also petitioned for a $5 million appropriation for the Cancer Center, but Gov. David Ige reduced the request to $4 million.
“We are of course supportive of reducing exposure to tobacco as it is a major contributor to cancer of many organs especially oral/throat, esophagus, stomach, colon and lungs. A reduction in cancers in Hawaii will help keep personal and state health costs down. That is always a good thing,” said Jerris Hedges, the Cancer Center’s interim director. “The continued population (and) personal health and state economic benefit from state investment in the Cancer Center warrants ongoing support regardless of the vehicle used (i.e. targeted taxation or fees versus general funds). It is hard to predict where an increased cigarette and little cigar tax will leave the Cancer Center support from the state.”
The Cancer Center’s financial troubles stem from an outdated business plan that had assumed the university’s share of the state’s cigarette tax would remain constant at about $20 million a year. But, as fewer people smoke, the tax revenues have dropped off.
“As before, some decrease in cigarette sales will occur with an increased tax,” Hedges said.
The most recent increase in the cigarette tax was in 2011, and the state now collects almost $130 million a year in cigarette and tobacco taxes.
Michael Zehner, executive director of the Hawaii Smokers Alliance, one of the opponents of the bill, called the measure “highly regressive” and said a tax hike would have a “really negative impact on lower-income residents.”
