Senate leaders say cigarette and opioid tax increases in House budget proposal not likely to stay in their plan

03/02/2018 03:18 PM

FRANKFORT – Now that the House has passed their 2018-2020 biennium budget, it’s the Senate’s turn to make modifications to the proposal which will fund state government for the next 2 years.

Senate Appropriations and Revenue chair Sen. Chris McDaniel, R-Taylor Mill, admits that one thing that has pleased him about this year’s process is how quickly the House passed a budget and moved it on to the Senate.

“Last time around, we just had 6 days to work on it,” McDaniel said. “They’ve given us a lot more time to take a look at it, be able to negotiate, to get it to the governor with enough time to handle constitutionally any veto override. That was a great first step.”

One marquee point with the House budget proposal is the 50 cents per pack tax increase on cigarettes as well as the 25 cents per dose tax levied on opioid distributors.

McDaniel was noncommittal about those taxes staying or not staying in the Senate plan.

“You know, we’re going to have to take a look at everything that they’ve done in the budget in terms of the context of the whole,” McDaniel said. “I know that some folks have expressed some support and dismay on both sides of it.”

Of course the overall riding factor with any budget proposal is fully funding the ARC of the state retirement systems which the General Assembly has pledged to do since 2013.

“The pensions are crowding out every other aspect of the budget and they’ve done so even more this time,” McDaniel said. “But we committed in 2013 to fully fund the pension and we did that in the ’14 budget, we did that in the ’16 budget, and we will absolutely do that in this budget.”

McDaniel expects it to take several weeks for the Senate to come up with their finalized budget proposal.

Senate President Robert Stivers, R-Manchester, believes that the cigarette tax or opioid tax has no chance of passing in his chamber, at least in the form of a budget proposal.

“I think it will be very difficult,” Stivers said. “Good taxing policy is something that grows, you implement a tax that grows because the base grows and it has a growth rate equivalent to what your demands on your expenditure side are going to be.

Stivers reiterated that he does still feel that comprehensive tax reform could still be possibly addresses during this session.

“It depends on timing,” Stivers said. “It was mentioned on the floor yesterday that there would be a look, now that they are done with a revenue bill and an appropriations bill, that they would be having discussions on a comprehensive package.”

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