From Deseret News archives:

Leavitt, Hatch in standoff over children's health insurance

2 Utahns disagree over expansion of children's insurance

Published: Friday, July 20, 2007 12:24 a.m. MDT
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But Cannon does not like the idea of tying insurance to the tobacco tax, nor does he like the government getting deeper into the health care business by expanding the program, said spokesman Fred Piccolo.

Piccolo pointed to facts from the Heritage Foundation, a conservative think tank, that the cigarette tax "disproportionately burdens low-income Americans, lacks long-term stability, and ultimately results in significant shifting of health care costs onto others."

A tax on tobacco could deter people from buying cigarettes, reducing tax revenues designed to fund the program. The government then would need to get the money from elsewhere to fund CHIP, he said.

Leavitt expressed similar concerns in his letter sent Tuesday to Senate Finance Committee Chairman Max Baucus, D-Mont., and the committee's top Republican, Charles Grassley, R-Iowa. He said the "use of tax increases to fund spending increases is undesirable and inadvisable."

"An increase in federal cigarette taxes is also among the most regressive revenue-raising measures one could propose," Leavitt said in his 10-page letter outlining the administration's opposition to the bill.

Leavitt also said the bill would "undermine the common goal of an affordable private health insurance market and an effective safety net so that the vulnerable get help from the government when needed."


E-mail: suzanne@desnews.com

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