West Virginia Tobacco Tax Increase Fails, Again

Another day, another update from Charleston.

Over the past few months the West Virginia legislature has been considering a variety of measures to help deal with a $270 million budget deficit, including raising the taxes on tobacco products.

It appears this will be the end of weekly updates regarding a potential tobacco tax increase.

Despite only days earlier passing a measure that would raise the tax on cigars from 7 to 12 percent and add a 65 cents per pack tax on cigarettes—up from 45 cents two weeks ago—yesterday the legislature approved an emergency funding package with no new tax increases for tobacco.

Instead, the legislature agreed to a deal that would cut certain spending and use the state’s rainy day fund, something Gov. Earl Ray Tomblin (D) had vowed to veto. Ultimately, the legislature forced the governor’s hand when it voted to adjourn until June 12 immediately after sending the budget proposal to his desk. This would have forced the governor to risk shutting down the government if he did not sign the bill into law, something that would have widespread economic impacts for the state as well as massive political implications for the governor himself.

Tomblin approved the measure with some objections and line item vetoes.

NEWS: Gov. Tomblin has approved SB1002 with objections. To view action taken on legislation, visit https://t.co/HaVJOdEGeT.

— Governor Jim Justice (@WVGovernor) June 2, 2016

By halfwheel estimates, a cigar with an MSRP of $9.50 would go from costing $10.17 to $10.64 had the increase passed.