Senate Votes Down Raise In Cigarette Tax To $1.50 A Pack


The vote leaves intact the $1.10 tax in John McCain's tobacco bill. McCain seems close to the 60 votes he needs to stop a filibuster.

By JAMES ROSEN, Washington Correspondent


     WASHINGTON --The Senate rejected a bid Wednesday to raise cigarette taxes by $1.50 a pack in the first bellwether vote on major legislation to put sweeping new government controls on the tobacco industry.
     The 58-40 vote against the $1.50 tax hike left intact a smaller increase of $1.10 a pack favored by Republican Sen. John McCain of Arizona, author of the tobacco bill. Senators met into the evening as they debated another key proposal that would strip the $516 billion measure of all liability limits for the cigarette companies.
     On the third day of contentious debate in the Senate, President Clinton urged lawmakers to pass the measure in order to protect 3,000 teenagers who begin smoking each day.
     "Today, we stand on the verge of passing legislation that will do far more than anything we have ever done to stop the scourge of youth smoking," Clinton said.
     One of the country's most famous teenage athletes, figure skater Tara Lipinski, joined Clinton and 700 other youths on the South Lawn of the White House.
     "Mr. President," Lipinski said, "in the fight to protect kids from tobacco and save lives, our team is going to win."
     Lipinski, at 14 the youngest gold medal winner ever in figure skating, later spoke at a rally outside the Capitol organized by the Campaign for Tobacco-Free Kids, a coalition of public-health organizations.
     Democratic Sen. Kent Conrad of North Dakota, a leading anti-smoking lawmaker, asked hundreds of youths at the rally: "Do you want to be targeted by the tobacco industry for addiction""
     "No!" the young people roared.
     The cry inside the Senate was nearly as loud at times. Conservative senators led by Republican John Ashcroft of Missouri spent four hours trying to stem the bill's momentum.
     "This is a massive tax increase, this is a massive expansion of government, this is an affront to the effort of families to provide for themselves," Ashcroft said.
     But a group of mainly Democratic senators tried in vain to set an even higher tax than McCain's levy of $1.10 a pack, already 4 1/2 times the current federal excise tax of 24 cents.
     Democratic Sen. Edward Kennedy of Massachusetts noted that those opposing the higher tax increase -- on the grounds that relatively poor people pay most cigarette taxes -- were the same senators who resisted his successful effort last year to increase the minimum wage.
     "How elitist and arrogant it is for those voices on the other side to cry these crocodile tears about working families!" Kennedy thundered.
     Forty-five of the Senate's 55 Republicans, including Sens. Jesse Helms and Lauch Faircloth, voted against the $1.50 tax hike, along with 13 of the 45 Democrats, including Sen. Dianne Feinstein.
     Feinstein, of California, said the steeper tax increase would fuel a black market in cigarettes. She said California, with a state excise tax of 37 cents a pack, already loses as much as $50 million a year in revenue through illegal sales.
     "We need to make certain that we don't increase the price of cigarettes so high that it becomes lucrative for smugglers and organized crime to become involved in cigarette smuggling so that, like cocaine, cheap black-market cigarettes will be available on street corners all over our country," Feinstein said.
     McCain said the attacks on his bill from both sides of the political spectrum -- from senators opposed to any tax increases and from those who want even higher taxes and other anti-tobacco penalties -- show that the measure is well positioned.
     McCain, chairman of the Senate Commerce Committee, continued to express confidence that the Senate will approve his legislation, though he was less certain it will do so by the end of the week.
     "You can't get through a minefield without setting off some explosions," McCain said. "This is a very large, very controversial bill. The watchword is patience."
     The McCain legislation requires the tobacco companies to pay the government $516 billion over 25 years, with much of it coming from the $1.10-a-pack tax increase.
     The cigarette makers would have to make additional payments -- up to $4 billion a year -- if youth smoking rates failed to decline rapidly enough. McCain's measure also imposes strict advertising limits and places the industry under the regulatory control of the Food and Drug Administration.
     Nearly identical votes on two amendments show that McCain is close to the threshold of 60 supporters he needs to protect his bill from a filibuster attempt.
     The Senate voted 58-39 Tuesday to defeat an attempt by Sen. Faircloth, of North Carolina, to limit to $250 an hour the fees trial lawyers will get if the tobacco legislation is enacted. That vote virtually mirrored the 58-40 tally on the $1.50 tax hike.

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