IPCPR Urges Pennsylvania Lawmakers, Governor to Reduce Spending

When a state like Pennsylvania has a budget shortfall, it’s tempting for some to turn to new tobacco taxes to make up the difference. Whatever happened to good old fashioned spending reductions, asks the International Premium Cigar & Pipe Retailers Association?

Governor Ed Rendell is proposing to spend $28 billion to $28.2 billion while many in the Pennsylvania legislature are looking at spending $27.5 billion. Both sides agree that there is not enough income to match either figure.

“Both the governor, a Democrat, and the legislators – mostly Republicans - have it wrong,” said Chris McCalla, Legislative director of the IPCPR.

“Imagine if your family decided at the beginning of the year how much money you should spend to be happy and then you tried to figure out how much money you expect to have and how much you will have to beg, borrow or steal to make up the difference. That’s not the way it’s done. Instead, you first look at your anticipated income and then you decide on what you can or should spend it,” said McCalla.

To close the spread between income and expenses, the governor is exploring a wide variety of possible new taxes dealing with cigars and cigarettes, gold buillion, candy and gum, cell phones and others.

“In the end, it is not these things that are taxed, it is the people who are using them.  People pay taxes, things don’t.  So when a politician says he hasn’t raised anyone’s taxes, the people know better and they are becoming more vocal and more upset about having government take their money, spend more than they make, and tell them how to live,” McCalla said.

IPCPR has more than 2,000 members.  They are, for the most part, small, family-owned businesses that manufacture, distribute and sell premium cigars, pipes and related accoutrements. 

“These are small businesses that hire local people and pay local, state and federal taxes.  There are more than 70 members of IPCPR in the state of Pennsylvania.  They have hundreds of employees and pay millions in sales, payroll and excise taxes. 

“Every time there is an increase in taxes on tobacco, prices go up and sales go down.  That means jobs are lost and some businesses will close.  Is that really what we want to do in this economy – put more people out of work and close businesses?” McCalla asked.

###