JEFFERSON CITY — Unlike leaders in other states who are trying to tackle an epidemic of youth vaping by raising taxes on electronic cigarettes, Missouri Gov. Mike Parson said he’s not looking at that as an option.
“I don’t know if pricing it out of someone’s reach is always the right answer,” Parson said at a recent news conference called to outline an educational campaign designed to crack down on underage use of vaping products.
Missouri has not raised its cigarette tax since 1993 and at 17 cents per pack, it is the lowest in the nation.
In a recent study, former state budget analyst Tom Kruckemeyer said Missouri’s tax is less than 10% of the national state average of $1.76 per pack.
Other states have decided that boosting taxes on vaping and tobacco products, as well as raising the legal age to buy them, are one way to reduce the number of youths who take up the habit.
Illinois is among 17 states that have imposed higher taxes on vaping products. In June, Gov. J.B. Pritzker approved a new 14.5% tax on vaping products. The move also set the legal age for buying traditional and e-cigarettes at 21 and boosted the tax on regular cigarettes by $1, to $2.98 per pack.
Pritzker said the higher cost would deter would-be smokers.
Illinois has reported five deaths related to vaping, while Missouri has reported two. The Missouri Department of Health and Senior Services says at least 35 people are suffering from vaping-related lung problems, possibly linked to certain ingredients in the product.
Parson acknowledges that Missouri’s low tax rate has resulted in higher spending on health care.
“We know in Missouri that we are above average when it comes to smoking,” Parson said. “We’ve got to realize that’s a problem. It’s very expensive for the state and for the health care industry.”
The Missouri Department of Health and Senior Services put the price tag on smoking-related illnesses at $3 billion annually, which is far more than the $105 million in revenue the state receives from tobacco taxes.
Missouri voters have not supported tobacco tax increases in recent statewide elections.
In 2016, for example, voters turned down two referendums. One was a 23-cent boost that would have raised money for transportation improvements. Another would have phased in a 60-cents-per-pack tax over four years to pay for early childhood programs.
In 2012, voters rejected a ballot initiative that would have increased the tax on a pack of cigarettes by 73 cents.
The same companies that have worked to keep the tax rate low also own large stakes in e-cigarette companies.
Altria, the parent company of Philip Morris USA, has a 35% stake in Juul, the best-known e-cigarette brand. Among Altria’s stable of lobbyists in the Capitol are John Bardgett, Andrew Blunt and former state Rep. Noel Torpey.
The companies also hand out campaign contributions.
According to an analysis by Kruckemeyer, Parson is the largest recipient of tobacco money in the state, reporting contributions worth over $183,000 over his career.
Attorney General Eric Schmitt, a Republican, has netted over $73,000 from tobacco companies, while Lt. Gov. Mike Kehoe has received $22,150.
Parson said he will not press for a tobacco or vaping tax hike as part of his crackdown.
Instead, he said the idea of raising tobacco and vaping taxes should be taken up by lawmakers when they return to the Capitol for their annual session in January.
“That’s a discussion you’ll have to have through the legislative process,” Parson said.
Because of Missouri’s Hancock Amendment, which requires state tax increases be passed by a popular vote, the issue will eventually come back before voters.
But Parson said getting the issue on the ballot likely will be a collaborative effort between tobacco companies and lawmakers.
“I would say someday, down the road, you will see the industry and the Legislature come up with some sort of an agreement on how we’re going to tackle this issue,” Parson said.