Oregon Voters Could Decide Next Year Whether to Hike Taxes on Cigarettes

Oregon lawmakers are poised to ask voters to decide whether to hike cigarette taxes by two bucks a pack.

The Oregon Legislature today revived a bill to increase tobacco taxes, which had previously stalled in committee. But in resuscitating the bill, the House Committee on Revenue tacked on an amendment—requiring voters to approve the tax hike in 2020.

The bill would still need a three-fifths majority in both a House and the Senate—but Oregon Democrats now have those margins, if barely. Assuring voters will have a say could remove potential opposition from moderate Democrats.

As Oregon Public Broadcasting first reported this morning, that tees up a big-dollar battle in the next election cycle. In 2007, tobacco companies spent $12 million defeating a ballot measure that would have raised taxes by 85 cents a pack. Ballot Measure 50 was rejected by voters in every county but Multnomah.

House Bill 2270 would raise the taxes on cigarettes from $1.33 a pack to $3.33 a pack. That would move Oregon closer to the tobacco tax rate of Washington state ($3.52 a pack) and above the tax in California ($2.87 a pack).

A tobacco tax increase is a top priority for Gov. Kate Brown, both because she wants to discourage smoking and because it could help plug a hole in the state's health care budget.

As WW first reported last year, Brown's proposed budget suggested the tobacco tax increase as a way to raise nearly $300 million in the 2019-21 budget cycle. The governor needs that money to fill a funding shortfall for the Oregon Health Plan, the state's Medicaid program.

Update, 2:34 pm: Brown's office tells WW it trusts voters to pass the tax.

"The tobacco tax is a key component to improving the health of Oregonians and providing long-term sustainable funding for the Oregon Health Plan," says Lisa Morawski, the governor's interim press secretary. "Oregonians have confirmed at the ballot box before that providing access to health care is important to them, and the Governor is confident voters will support this critical public health policy."