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| For Immediate Release September 5, 2003 |
“It is apparent that many legislators have concluded that SB 2 is a job killer and the sponsors are franticly trying to find amendments that will attract enough votes for passage,” said CMTA president, Jack M. Stewart. “There is an old adage in Sacramento that says ‘don’t amend a bad bill.’ SB 2 is a bad bill and this amendment makes it worse.”
The amendments concoct a complicated formula for distributing revenues raised by the new tobacco tax to businesses affected by the health care mandate without specifying what the tax credit will be.
“This is a gigantic legislative shell game where the unwary businessperson is promised a tax credit to offset costs mandated by the state, and then they are left holding the empty bag when the revenues needed to fund the tax credit never materialize,” Stewart continued. “By increasing the tax on cigarettes by nearly two hundred percent, total cigarette sales are bound to decline.”
When New York City more than doubled its cigarette tax in 2002, cigarette sales dropped by more than fifty percent and the total amount of cigarette tax revenues decreased.
Imposing a new multi-billion dollar health care mandate on business will cost California more jobs and forestall an economic recovery.