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LETTERS: Tobacco tax hike is the best way to offset Ga. budget shortfall

Editor's note: This letter was sent to the Gwinnett Legislative Delegation.

As you know, Gov. Sonny Perdue has recently proposed a $247 million tax on hospitals, with Gwinnett Medical Center's share at about $8.5 million dollars. His only alternative to this proposed tax would be a devastating payment rate cut to health care providers who serve the state's Medicaid patients.

Either a hospital tax or a rate cut would place a significant burden on Georgia's health care system, especially Gwinnett Medical. We also just learned of another proposal to eliminate the sales tax exemption for nonprofit hospitals in Georgia, costing them as much as $150 million. The cost to GMC is about $8.5 million.

The Gwinnett Chamber of Commerce is opposed to these bad public policy proposals, but understands that cuts and/or new revenue must be considered in the difficult budget crisis we are facing. Therefore, the Gwinnett Chamber would support a $1-per-pack increase in the state's tobacco tax as an alternative. House Bill 39, already introduced in the General Assembly, would generate more than $350 million in state revenue and prevent an unhealthy hospital tax or damaging cuts to Georgia's Medicaid program.

There are many arguments for and against the tobacco tax, but from the Chamber's perspective, this is a tax that does not impede our economic development and job creation efforts and does not jeopardize our competitiveness as a region or state. It does, however, have two major benefits: substantially reduces smoking in adults and children, and provides a new revenue source to support quality health care in Gwinnett, metro Atlanta and Georgia.

Some state elected officials may fear that any tax, no matter the voter support or its benefits, would not be politically good in an election year. However, we believe Georgia voters know the magnitude of the budget crisis and will support this proposal — in a recent survey, 73 percent supported a $1 fee on tobacco.

For all of these reasons, we strongly encourage you to support a sensible alternative to the hospital tax or the Medicaid rate cut — namely HB 39, the $1-per-pack increase to the state's tobacco tax.

— Jim Maran

President and CEO, Gwinnett Chamber of Commerce