House keeps tax hike on smokes

COLUMBIA -- South Carolina legislators voted Wednesday to keep a 30-cent cigarette tax increase in the state budget, but repeatedly rejected proposals to hike the tax any higher.

The House refused by a 106-12 vote to remove the 30-cent a pack increase from the state's $5 billion spending plan -- which is down from $7 billion two years ago.

South Carolina's 7 cents-per-pack cigarette tax is the nation's lowest and has not changed since 1977. A 30-cent increase would make the tax equal to Georgia's and still 8 cents-per-pack cheaper than North Carolina's. Nationwide, the average state cigarette tax is $1.34 per pack, with Rhode Island ranking first at $3.46.

It's unclear if the Senate will go along with the 30-cent hike. Legislators have debated increasing the tax for several years. They approved a 50-cent tax hike in 2008, but couldn't override Gov. Mark Sanford's veto. The House again passed a 50-cent plan last year, but Senate debate stalled.

Raising the tax to 37 cents a pack is expected to generate $88 million, with $85 million of that going to a trust fund for future Medicaid expenses.

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Rep. Leon Stavrinakis tried to raise the tax by $1, with the revenue divided between the health care trust fund, income tax reduction and education. The Charleston Democrat said the state would save lives and reduce state health costs. "The impacts on our state's health and financial welfare are just overwhelming from this drug," he said. "We have cheap tobacco, but what's it getting our citizens? Is the benefit outweighing what we're not doing to educate people in South Carolina, to keep people healthy in South Carolina?"