The Ketchikan Gateway Borough has completed drafting an ordinance that would impose a $3-per-pack tobacco tax within borough boundaries. The ordinance also would tax other tobacco products – including e-cigarettes – at 75 percent of their wholesale price.
The Borough Assembly voted on July 6 to move forward with the idea, but it wasn’t endorsed by all Assembly members. In fact, the same motion failed in an earlier vote, when some supporting Assembly members were absent and not able to participate in the decision.
It was brought back for reconsideration, and in a 4-3 vote, the Assembly directed borough management to draft the ordinance.
It will be in front of the Assembly for the first of two votes at its next meeting, and likely will result in another split. Assembly Members opposed to the measure were unequivocal.
During the June 6 meeting, Assembly Member Jim Van Horn called in from Juneau, where his wife was finishing radiation treatment for lung cancer. Van Horn said he is a lung-cancer survivor himself, and lost his first wife to lung cancer.
“This insidious thing called cancer is caused by smoking, but at the same time, I feel that $3 a pack is too excessive,” he told the Assembly
Those opposing the tobacco tax say it’s a revenue grab, and Assembly Member Glen Thompson said that people on the right and left tend to like “sin” taxes.
“Conservatives like to legislate morality and liberals tend to like to control the economy, so this has something that both sides really like,” he said. “But the poor guy in the middle is the one paying the tax.”
Thompson suggested increasing a general tax, such as the sales tax, if the borough needs more revenue, rather than targeting tobacco users.
But those who support the tobacco tax say it’s a deterrent for youth who might be tempted to pick up the habit.
Assembly Member Allen Bailey said, “There’s has been more than enough statistics provided that has indicated that youth begin their cigarette smoking early age. And if they begin below the age of 18 or 16, the likelihood of them continuing their smoking habit throughout their live, is not only a cost to them, a cost to their family, and – as exemplified by one of the Assembly members here – it costs the lives of others.”
It’s estimated that the proposed tobacco tax would generate about $1.2 million a year in new revenue. The draft ordinance calls for directing up to 15 percent of that toward smoking-cessation programs. The rest would be divided between the borough and the City of Ketchikan, based on population.
The ordinance also calls for an annual report, showing how the proceeds of the tax have been used, and its effectiveness on reducing tobacco use in the community.
The next Assembly meeting is Monday, Aug. 3.
