Cigarette tax not way to save student grants
Of the two proposals on the table for funding grants for Illinois college students, the Republicans plan for another round of tax amnesty makes more sense than nearly doubling the state’s tax on cigarettes.
About 137,000 students receive money based on financial need through the Monetary Assistance Program – about 3,500 of them attend Illinois State University. Illinois Wesleyan University has 430 students eligible for MAP grants; Heartland Community College has about 900, according to school officials.
The budget approved by the Legislature and signed by the governor provided only enough money to support MAP grants for the fall semester, leaving colleges wondering whether they could find money elsewhere in their budgets to help these students and leaving students wondering whether they will be able to complete their education.
The failure to directly address the MAP grant and other funding issues before adjourning this summer showed a complete lack of responsibility by lawmakers and the governor.
For the governor to go around now, spearheading rallies for “save” MAP, while he did little to prevent the half-baked budget that created this problem, is a political snow job.
But, this editorial will focus on the cigarette tax. Tuesday’s editorial will tackle the proposed tax amnesty.
Democrats are touting a dollar-a-pack tax on cigarettes as the savior for MAP. However, such an increase would give Illinois a higher state tobacco tax than any of its surrounding states except Wisconsin, where the tax is $2.52 a pack compared to the proposed $1.98 tax for Illinois.
When county and city taxes are included, the extra dollar would push Chicago ahead of New York City as the city with the highest combined taxes on a pack of cigarettes.
It’s plain to see how that would send people near the borders to stores in other states, not only to buy cigarettes but to fill their fuel tanks and buy snacks and other items while they are there. That would potentially decrease revenue, not only from the tobacco tax but also from sales taxes and motor fuel taxes.
In addition, the extra dollar a pack would likely inspire more people to quit smoking – good for individuals’ health and overall health care costs, bad for revenue generation – and could cause more people to buy cigarettes over the Internet, smuggle them across the border or even steal them.
Add to this the question of whether a small group of taxpayers – those who still smoke – should be burdened with financing a significant portion of a program that is a general state benefit.
A smaller tax increase – perhaps 25 cents a pack – might be justifiable to raise more revenue without unduly affecting border-area businesses and smokers themselves. But a dollar-a-pack is too much.
Pantagraph, October 12, 2009
