Cig Tax May Leap In Ex-Tobacco Bastion

The specter of deep cuts in state spending has sparked an intense lobbying effort in Virginia to raise its lowest-in-the-nation cigarette tax, pitting those pushing the increase against tobacco interests and anti-tax lawmakers in next month's legislative session, The Washington Post reports in its Saturday editions.

Local governments, educators, health groups and other special interests are pressing Gov. Mark Warner (D) to seek an increase in the 2.5-cent-per-pack tax, which they portray as one of the few hopes for avoiding severe reductions in state programs for children, the poor and the elderly, the Post says.

Raising the tax to the national average -- 60 cents per pack -- would generate more than $350 million per year for the state treasury. Virginia's faltering economy will force Warner and state lawmakers to slash more than $1 billion to balance the budget unless new sources of money are found.

"We think it's the right thing to do," Donna Reynolds, a lobbyist for the Virginia chapter of the American Lung Association, which is part of a 40-group coalition pushing for a tobacco tax increase, told the newspaper.

Even some in the tobacco industry, which officially opposes any increase in the tax on its product, have quietly approached members of Warner's administration and key lawmakers to discuss possibly crafting a tax increase they could live with, according to Post legislative and administration sources.

States across the nation, including ones that grow tobacco and manufacture cigarettes, are raising cigarette taxes to close budget gaps, the Post points out. In the District of Columbia, Mayor Anthony Williams successfully pushed for an increase in the cigarette tax from 65 cents to $1 per pack, matching the tax rate in Maryland. The new D.C. rate goes into effect Jan. 1.

In Virginia, Warner has so far resisted requests to actively seek an increase. He has vowed to present a balanced budget without a tax increase of any kind. "The budget he submits on December 20 will have no tax increases," spokeswoman Ellen Qualls said to the Post.

But the governor has also energized the lobbying effort by hinting that he still might support a General Assembly-led effort to raise the cigarette tax during the legislature's 45-day session. "He has left it open that if the legislature generates significant momentum behind a tobacco tax increase, he's open to that discussion," Qualls said.