Levies an additional tax on cigarettes (Item #4) (OR +$46,000,000 GF RV See Note)
The enactment of HB 3 is expected to generate significant revenue, with estimates suggesting an increase of approximately $46 million to the General Fund. This additional revenue is intended to support public health initiatives, especially those aimed at reducing tobacco use and improving overall health outcomes in the state. By increasing the cigarette tax, the bill aims to discourage smoking and thereby contribute to better public health while simultaneously boosting state revenues.
House Bill 3 aims to levy an additional tax on cigarettes in Louisiana, raising the total tax per pack from 86 cents to $1.08. This legislation enacts R.S. 47:841(B)(7), which specifies the new tax rate applicable to both retail and wholesale dealers beginning April 1, 2016. Furthermore, retailers and wholesalers will be required to file an inventory of all cigarettes and unused tax stamps they possess before the new tax implementation date and pay any additional taxes they owe by May 1, 2016.
The sentiment around HB 3 appears to be generally positive among public health advocates and some lawmakers, who view the increase in tobacco taxes as a necessary step to combat smoking-related health issues and encourage individuals to quit smoking. However, there may be opposition from certain business groups and individuals who argue that additional taxes on cigarettes impose a financial burden on consumers and local businesses.
Notable points of contention surround the potential economic impact on tobacco retailers and concerns about the effectiveness of increased taxation as a smoking cessation strategy. Critics may argue that while the intent is to reduce tobacco use, such measures could lead to decreased sales for local businesses. Additionally, there is apprehension regarding the potential for black market tobacco sales to rise as prices increase, undermining the intended public health benefits of the tax increase.