HELENA – The committee opposing a proposed voter initiative that would significantly increase Montana’s tobacco taxes wants the state Supreme Court to change the wording that will appear on the November ballot.
Initiative 185 would raise the state cigarette tax by $2 a pack, to $3.70 a pack. It would also increase taxes on other tobacco products, including moist snuff, and add taxes on e-cigarettes and vaping products.
Up to $26 million of the money raised would be used to extend Montana’s Medicaid expansion program, which is currently scheduled to expire next year.
But Montanans Against Tax Hikes, the committee formed to oppose I-185, says the summary of the initiative that voters will see on the ballot is misleading. The group filed a legal challenge, asking the Montana Supreme Court to order changes in the language.
The group claims the current language isn’t clear about how much taxes are increasing on tobacco products other than cigarettes and moist snuff. That tax is increasing from 50% of a product’s wholesale value to 83%.
They also want the statement to specifically note that much of the money raised from the higher taxes will go toward the state general fund.
The current language notes several specific uses for the money, including Medicaid, veterans’ services, tobacco prevention and services for seniors and people with disabilities. But Montanans Against Tax Hikes argues the general fund will receive one of the largest shares of funding, so it should be included as well.
Chuck Denowh, treasurer for Montanans Against Tax Hikes, released a statement about the issue.
“I-185 is a massive new tax increase that permanently expands Medicaid but doesn’t allocate enough money to pay for it, leaving all Montanans on the hook for tens of millions of dollars per year,” he said. “Montanans Against Tax Hikes plans to run a campaign and make sure voters understand why they should reject I-185.”
Supporters of I-185 say the legal challenge is an attempt to create confusion around the issues.
“Big Tobacco will pretty much try anything to protect their profits at the expense of Montana,” said Amanda Cahill, Montana director of government relations for the American Heart Association. “They’re pursuing this unnecessary legal challenge aimed at taking away health care for Montana families and our veterans; they’re wasting taxpayer dollars on costly lawsuits. It’s a typical tactic.”
Montanans Against Tax Hikes has received more than $1 million in planning, polling, legal services and other in-kind contributions from Altria Client Services and RAI Services Company. Those groups are lobbyists for the major tobacco producers Altria – formerly known as Philip Morris – and Reynolds American, Inc.
Healthy Montana for I-185, the committee supporting the initiative, has drawn substantial cash and in-kind contributions from the Montana Hospital Association, the national health care reform group Families USA, labor unions and groups like the American Cancer Society.
The Montana attorney general’s office is responsible for approving ballot statements.
The state will have until Aug. 13th to respond to the challenge.