The enactment of HB746 is expected to create a significant impact on state revenue, as increased excise taxes on cigarettes typically lead to higher state earnings. The bill comes at a time when public health initiatives encourage a reduction in smoking prevalence, which aligns with raised costs as a deterrent to tobacco consumption. The new tax rate is set to take effect on July 1, 2023, allowing time for adjustments by dealers and consumers alike.
Summary
House Bill 746 is a legislative act aimed at amending Section 27-69-13 of the Mississippi Code of 1972 to increase the excise tax on cigarettes. The bill specifies that the new tax rate will be set at Five and Nine-tenths Cents (5.9) for each cigarette sold, replacing the previous rate of Three and Four-tenths Cents (3.4). Additionally, the tax provisions extend to other tobacco products, including cigars and chewing tobacco, which will continue to be taxed at fifteen percent (15%) of their manufacturer's list price.
Contention
While the bill generally supports health initiatives aimed at reducing tobacco use, it could face opposition from tobacco retailers and manufacturers who may argue that higher taxes could lead to decreased sales and possible job losses in the tobacco industry. There may also be concerns regarding the economic impact on consumers, particularly among lower-income individuals who may be disproportionately affected by tobacco price increases.
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Furthermore, this bill is part of a broader discussion on tobacco taxation and public health policy in Mississippi. The ongoing debate includes considerations of how such tax increases are used, whether for health programs, education, or other state needs, and if they effectively lead to the desired public health outcomes.