Tax on cigarettes discriminatory, says National Taxpayer's United

NATIONAL TAXPAYERS UNITED OF ILLINOIS

407 S. Dearborn, Suite 1170 * CHICAGO, ILLINOIS 60605

(312) 427-5128 * Fax (312) 427-5139 * Web Site * E-mail









FOR IMMEDIATE RELEASE Contact: Jim Tobin: (773) 354-2076 (Cell)

August 2, 2007 (312) 427-5128 (Office)



PROPOSED STATE TAX INCREASE ON CIGARETTES DISCRIMINATORY





CHICAGO—The president of Illinois’ largest taxpayer organization charged that the plan proposed by State Senate leadership to raise the state cigarette tax by $0.90 per pack discriminates against the state’s low income users.




“Members of the Illinois General Assembly have a duty to protect the state’s low income families,” said Tobin. “This proposed regressive tax increase is inherently discriminatory, and would severely impact low income tobacco users. It also would hurt small retail businesses, especially those in poor areas, which depend on tobacco sales to shore up their extremely narrow profit margins.”



“State cigarette tax revenues over the past few years have trended downward, due in no small part to previous tobacco tax increases that have made Illinois’ tobacco tax very high, and Chicago’s tobacco tax the highest in the nation. Cigarette revenues went down from $760 million in 2004 to $639 million in 2007. Further increases will reduce the state’s revenues even more.”



“The best way to increase cigarette tax revenues would be to lower the tax to be at least competitive with surrounding states, if not lower.”



“The proposed huge tax increase on cigarettes could have devastating effects on the lives of persons in poor neighborhoods. As a result of these outrageous tax rates, how long will it be before poor children are gunned down in the streets fighting over turf where they can sell their smuggled, contraband cigarettes?”



“The proposal also would allow every Illinois county to enact cigarette excise taxes up to $2.00. In other words, the bill would give every county in the state Home Rule Taxing Powers. Every attempt to give counties Home Rule powers has been defeated at the ballot box by voters in those counties. The election results clearly show that county-wide home rule taxing powers are extremely unpopular with voters, who have long memories when it comes to tax increases.”



“The state budget should be balanced by cutting spending. It should not be balanced on the backs of the state’s low income families.”



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Founded in 1976, NTU is the largest taxpayer organization in Illinois with over

10,000 members and affiliation with more than 200 local taxpayer groups.