Cigarette TAX negotiations begin soon

House and Senate leaders to begin talks for long increase the size of a cigarette tax.

On Thursday, with no debate, the House voted to propose negotiations with the Senate on cigarettes. The house has a proposal to increase the tax by 82 cents to $ 1 per package. The Senate proposed a more modest 31-percent increase to 49 cents per pack.

Both the House and Senate leaders have said they believe it is urgent, they agreed to accelerate the increase in taxes to provide additional income for the patient state tax coffers.

"The sooner we do this, the sooner we began to receive income," said Senate Finance Committee Chairman Dean Kirby, R-Pearl. "It's so easy."

Legislature is looking for additional funds at the time that the general fund tax collections of $ 90 million below projections for the current fiscal year. And the collections of the tax seems to be worsening.

In January, tax revenues by more than 6 percent below estimates, and 3 percent below the amount received in January 2008.

Governor Haley Barbour had already made $ 200 million in budget cuts based on current tax collection and the amount estimated to be collected until the end of the fiscal year on June 30.

"If there were no federal money," Barbour said: "My $ 200 million in cuts, would not be enough."

Barbour and legislative leaders are counting on help from its budget from the federal stimulus package addressed Congress on the orders of President Barack Obama.

Speaker of the House of Representatives, Bill McCoy, D-Rienzi, said that under current federal legislation, which is in its final form, the Mississippi can get 2.6 billion dollars over several years.

Whatever the final version, and the amounts the federal stimulus package and an increase in cigarette tax will be key components in the state budget.

But the budget leaders say they are not sure what to do with federal money.

"I really do not know if it will get during this budget cycle," said House Appropriations Committee Chairman Johnny Stringer, D-Montrose. "I hope he does, but we must continue with the budget process, as we do not have it."

Even if the amount of federal funding can not be solved while the Legislative is planned to complete its budget work at the end of March, Stringer said lawmakers could take money earmarked for Medicaid and use it in other places.

The program remains a deficit, but it is usually believed that the federal package will include funds to help states with Medicaid.

The amount of the federal stimulus package is one part of the budget puzzle from the hands of state legislators. But another key part of the budget picture - the number of cigarettes - is entirely the Mississippi Legislature.

Both the House and Senate called for an increase in the cigarette tax, to be in place by March 1, that is, funds for the current fiscal year will be available.

The Senate wants to spend money for the current fiscal year to replenish the fund, which holds down the car's price tag. House wants to spend money for the current fiscal year to offset the decline in education.

But the state tax commission said that probably takes 30 days to accept a cigarette tax increases. This makes the March 1 decision is unlikely because the House-Senate negotiations, would probably not be until early next week.

And the Senate Appropriations Committee Chairman Alan Nunnelee, R-Tupelo, said additional research to determine the impact of 61 cents per Pack increases the federal tax would have on government revenues. Obama signed the federal cigarette tax increase in the right environment.

Health advocates note that, as a tax on cigarettes, gets more, more and more people quit smoking. Due to the increase in federal tax, the amount received from the State tax is likely to be less than originally anticipated.