Capitol Alert

Tobacco companies drop nearly $17 million into anti-tax campaign

Californians pay among the lowest taxes on tobacco products in the nation at 87 cents per pack of 20 cigarettes, which hasn’t changed in nearly two decades. Proposition 56 would raise the tax to $2.87 a pack. Taxes on other tobacco products, including vaping products, would also increase.
Californians pay among the lowest taxes on tobacco products in the nation at 87 cents per pack of 20 cigarettes, which hasn’t changed in nearly two decades. Proposition 56 would raise the tax to $2.87 a pack. Taxes on other tobacco products, including vaping products, would also increase. Associated Press file

Game on.

After months of eerie silence from the tobacco industry, Altria and R.J. Reynolds reported nearly $17 million in contributions Friday to oppose Proposition 56, which would increase tobacco taxes by $2 a pack in California.

Altria contributed $10.8 million through its subsidiary companies: Marlboro-maker Philip Morris, cigar brand John Middleton Co. and e-cigarette brand NuMark. R.J. Reynolds, which makes Camel cigarettes and other brands, gave an additional $6.2 million.

The companies organized and funded the campaign to highlight the “many problems with Prop. 56,” said Beth Miller, a spokeswoman for the campaign, in a statement.

“The committee, which includes educators, health care professionals, law enforcement, labor, small businesses and taxpayers, intends to conduct a vigorous campaign to educate voters on the facts of the initiative and why it deserves their ‘no’ vote on Election Day,” Miller said.

In one day, the cigarette companies nearly matched the $18.5 million raised by proponents of the measure over the past year.

The pro-tax coalition includes the California Association of Hospitals and Health Systems, California Medical Association, California Dental Association, California State Council of SEIU, American Cancer Society, American Heart Association, Blue Shield of California and billionaire philanthropist Tom Steyer. Thus far, the hospitals association is the largest pro-tax backer of the measure with $10 million contributed to the proponents’ campaign committee, which is called Save Lives California.

“Tobacco companies have made it clear they will do anything to protect their profits at the expense of our children’s health,” Steyer said in a statement. “Yet we remain resolute and we will stand up to the big tobacco Goliath because it’s the only way to protect our children and save lives.”

$2Increase in California tax per pack of cigarettes if Proposition 56 passes

Proponents of the tax believe they have a better shot at prevailing this year, despite two previous losses. They cite a broader and better funded coalition of backers. But they still expect their tobacco industry opponents to spend three times more money.

The coalition said early on that it would need at least $25 million to beat tobacco interests in the fall. Thus far, much of the pro-tax group’s reported spending has gone to signature-gathering efforts to land Proposition 56 on the Nov. 8 ballot.

The money drops mark the first public move from tobacco in the ballot measure battle. The companies have yet to file any reports detailing spending and have remained relatively mum about the measure.

The ballot measure is among several challenges the industry has faced in California this year. The state Legislature passed a series of laws earlier this year to deter tobacco use, including a measure to raise the age to buy tobacco products from 18 to 21.

Californians pay among the lowest taxes on tobacco products in the nation at 87 cents per pack of 20 cigarettes, which hasn’t changed in nearly two decades. Proposition 56 would raise the tax to $2.87 a pack. Taxes on other tobacco products, including vaping products, would also increase.

Click here to go to The Money Trail.

Tom Steyer and Sen. Richard Pan, D-Sacramento, joined a coalition of medical and labor groups at C.K. McClatchy High School earlier this year to launch a petition to put a tobacco tax increase on the November ballot.

Sweeping tobacco control bills that treat electronic cigarettes like tobacco products have been signed into law by Gov. Jerry Brown. Pro-vaping advocate David Hansen had testified against the vaping legislation.

Taryn Luna: 916-326-5545, @TarynLuna

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