Thursday, July 26, 2007

Ohio trying to hock their Tobacco Settlement

The Tobacco Settlement never was about reducing smoking, it was always about a hidden tax on cigarettes. HERE is how it worked: Instead of simply raising state taxes on cigarettes, the states sued the tobacco companies and got a big settlement. Same effect as a tax of course, prices of cigarettes go up and politicians get more money to give away, SWEET!! The States pretended like they would use the money for "smoking reduction" but everybody knew that was a bunch of horse malarkey, they simply threw most (some went to the lawyers) of the money in the general fund and kept right on spending.

Now, Ohio pols wants to take their future payments from the "tobacco settlement" (wink, wink..tax) and hock them for a big cash settlement because those damn feds are messin up the game by threatening to raise federal cigarettes taxes...damn feds.

Plunder and pillage is such a complex bidness, especially when you are competing with the feds.

Link

Columbus- With a proposed increase in the national cigarette tax casting a long shadow, a panel of Ohio officials took the first step toward completing a plan to raise $5 billion for the state by selling off future payments from tobacco companies.

As Congress considers legislation adding 61 cents a pack to the cigarette tax to pay for children's health care expansion, the Buckeye Tobacco Settlement Financing Authority is racing to get the largest financial transaction in Ohio's history off the ground.

Timing is crucial for the three-member panel as it hurries to get the multibillion-dollar bond plan into financial markets by early November - before potential new taxes, court decisions or more-extensive smoking bans are rolled out.