Cigarette Tax Boost Gains Votes Eight Senate Republicans Back Plan For 43-Cent Hike To Aid Kids

Eight Senate Republicans, including three committee chairmen, lined up on Tuesday behind legislation that would raise cigarette taxes to pay for health insurance for children now uninsured, giving a striking boost to the bill’s prospects.

Sen. Orrin Hatch, R-Utah, who heads the Senate Judiciary Committee, recruited seven others from his party to co-sponsor the bill, which he introduced on Tuesday with Sen. Edward Kennedy, D-Mass.

The measure would increase the federal cigarette tax to 67 cents a pack, from the current 24 cents, yielding $20 billion a year in grants to states so that they could provide insurance for children whose low-income working parents do not qualify for Medicaid.

At Hatch’s insistence, $10 billion a year from the tax increase would go to deficit reduction.

Both Hatch and Kennedy said a major benefit of the tax increase was that it would discourage youth smoking. They cited a study by Frank Chaloupka of the University of Illinois that found that every 10 percent increase in cigarette prices cut teenage smoking by 7 percent.

They estimated their proposed 43-cent increase would lower teenage smoking by 15.7 percent.

The Senate majority leader, Trent Lott of Mississippi, appeared annoyed by Hatch’s recruitment of Republican co-sponsors for a measure to raise taxes, and said Republicans would find another solution to the problem of uninsured children, perhaps tax credits or tax-advantaged medical savings accounts.

“This is not last year,” Lott said, “and a Kennedy big-government program is not going to be enacted.”

But Hatch told a news conference the bill should not require any additional federal bureaucrats, since the government already collects cigarette taxes and since the new money in grants for the states would be distributed under Medicaid formula.

The Republicans whom Hatch got to co-sponsor the bill are Sens. Ted Stevens of Alaska, chairman of the Appropriations Committee; James Jeffords of Vermont, chairman of the Labor and Human Resources Committee; Robert Bennett of Utah; Ben Nighthorse Campbell of Colorado; Susan Collins and Olympia Snowe of Maine, and Gordon Smith of Oregon. Hatch said he hoped to sign up more soon.

The measure has wide support among Senate Democrats. But the Constitution requires that tax measures originate in the House, and so the Senate is unlikely to act until the House sends it a bill with the taxes included. Jeffords and Hatch may each hold hearings soon, however.

As of now, House Republican leaders say they oppose any bill that, like this one, would increase taxes.

But an aide to Rep. Richard Gephardt of Missouri, the House minority leader, said he was working on legislation that might provide for a smaller tax increase, with all the proceeds going to child health insurance and none to deficit reduction.