The state Senate has passed an eminently sensible bill to raise the cigarette tax by 50 cents per pack. We hope Gov. Mark Sanford's meddling won't derail the plan.
In recent years, the Legislature has debated various proposals to raise the 7-cents-per-pack tax, which is the lowest in the nation. It has not been increased in 31 years.
Last year, the S.C. House approved a 30-cent increase in the tax, but tied it to cutting the sales tax on groceries. Half of that proposal already has been achieved with the elimination of the grocery sales tax in last year's budget.
The Senate bill goes farther and, we think, it is a better plan. Under this proposal, which passed with an overwhelming 33-11 vote, about half of the $160 million raised would be used to expand Medicaid services to low-income families and the disabled, while the other half would pay insurance premiums for low-income workers.
It is estimated that this plan would help a quarter of the state's uninsured -- or 700,000 people -- find or buy medical coverage. And because every dollar the state spends on Medicaid is matched three-to-one by federal dollars, this also is an economical way to help hundreds of thousands of the state's neediest residents.
Significantly, simply raising the cigarette tax also would provide a health benefit in its own right. Ample evidence in other states shows that raising the price for a pack of cigarettes discourages young teens from smoking. Thus, a 50-cent hike in the cigarette tax could prevent thousands of young South Carolinians from picking up the habit in the first place.
But despite these advantages, the bill faces major hurdles before it could become law. The House could approve the Senate version as written, but if it does not, the proposal would go to conference committee where members of both houses would try to hammer out a compromise bill.
But the greater challenge may be Gov. Sanford's veto pen. Sanford reiterated his promise Thursday to veto any tax increase without an offsetting tax cut.
Sanford has championed the idea of offsetting an increase in the cigarette tax with a decrease in the state income tax or an optional flat tax. A flat tax would give South Carolinians two options for paying their taxes: Paying the current 7 percent rate and using deductions; or paying a flat tax of 3.4 percent with no deductions, which would have the effect of lowering overall income tax revenues.
At a time when the state is faced with the need for across-the-board budget cuts, reducing the income tax makes no sense. This also is a typical example of the piecemeal tax revision the state has engaged in for years without fully examining the overall ramifications and repercussions.
If the governor requires a tit-for-tat tax cut for raising the cigarette tax cut, why not simply declare the grocery sales tax cut as the offsetting tax cut? What the state can't afford to do is pass on the opportunity to provide health care to hundreds of thousands of low-income residents while preventing teens from taking up a habit that eventually is likely to kill them.