Va. tobacco bill seeks tenfold tax hike

November 25, 2003|Associated Press

RICHMOND, Va. -- Virginia's cigarette tax, the nation's lowest, would increase tenfold under a plan proposed yesterday by Governor Mark R. Warner just a few miles from the world's largest cigarette factory.

Efforts to boost the state's 2.5-cent-per-pack cigarette tax have consistently failed in a Capitol where golden tobacco leaves appear in frescoes painted on the rotunda ceiling. Philip Morris's headquarters and its cigarette factory, the world's largest, are in Richmond.

Among Warner's proposals were a one-cent increase in the state sales tax and raising income taxes for the wealthy, while cutting the grocery tax and income taxes for the poor.

In the last two years, the state has had to reconcile $6 billion in budget shortfalls. The new tax plan gives local governments the right to tax cigarettes up to 50 cents a pack, but caps state and local taxes combined at 75 cents.

"This is a marathon," Warner said of the battle to push his plan through a heavily Republican General Assembly.

Republicans quickly accused Warner of violating his campaign promise two years ago not to raise taxes.

"Mark Warner has engaged in a potentially devastating tradeoff of Virginia jobs for short-term revenue growth," said Kate Obenshain Griffin, the state GOP chairwoman.

Warner immediately began a statewide public relations campaign to portray his proposals as a break for the little guy that will benefit two-thirds of Virginia's population.