Senate gives final approval to cigarette tax increase


COLUMBIA -- The Senate tonight stripped down a bill to increase the cigarette tax and earmarked almost all of the money it would raise toward future health care costs as a way to prepare for an expected veto from Gov. Mark Sanford.

The bill would raise the tax by 50 cents to 57 cents a pack and is expected to generate $136.1 million to be used to plug expected shortfalls next year in the state budget.

The bill now returns to the House, which passed it last year.

Most of the money would go toward Medicaid expenses. Additionally, $5 million would go to the Hollings Cancer Center at the Medical University of South Carolina for lung cancer research and another $5 million toward helping people quit smoking and stop them from starting.

The Senate took out provisions that would have set aside $2.7 million for promotion of South Carolina's agricultural products and $3.5 million toward an infrastructure grant program for the state's Interstate 95 corridor.

By adding money for I-95 projects and agriculture promotions cost the legislation votes, and put the bill at risk of failing short of the votes needed to override a probable veto by the governor. The Senate had added that spending on March 31 when the body gave the bill key approval.

Senate President Pro Tem Glenn McConnell, R-Charleston, and Sen. Mike Rose, R-Summerville, had said they wouldn't vote for the bill if it was loaded down with new spending commitments unrelated to health care.

"I am for a 50-cent increase with all the money being spent for health care," Rose said this morning. "What I am not for is raising a cigarette tax with millions of the money going for expenditures that have nothing to do with health."

The Senate reached a compromise by annually directing $3 million to go to I-95 infrastructure improvements and $1 million to the Department of Agriculture for marketing South Carolina-grown crops from the state's tobacco settlement money, when available.

Rep. Chip Limehouse, R-Charleston, said he will lead an effort in the House to approve the cigarette tax increase. Supporters in the House are also preparing for a veto.

South Carolina's cigarette tax is the lowest in the nation and has not been increased since 1977.

The House also approved a 30-cent increase as part of the state budget. But the bill to increase it by 50-cent is expected to be the proposal to be voted on.