Federal Legislation Adjustment
PROPOSED TOBACCO DEAL: ISSUES
Under Section X of the multistate agreement, if federal legislation
requires participating tobacco companies to make payments to the federal
government, and some portion of that money is sent to the settling states,
those payments may be offset, dollar for dollar, from the annual payments.
Concerns and Questions:
Depending on how they are implemented, this provision appears like to
apply even to federal excise taxes on tobacco.
This provision is not limited to healthcare reimbursement legislation
and payments. Even if it were, why should the states forfeit money from
the federal government?
To the extent that this provision ensures that the federal government
will not make payments to the states from tobacco company payments, what
is the basis for thus infringing on federal power -- especially where it
would benefit the states?
The effective bar on federal tobacco tax transfers to the states will
make it much less likely in political terms that Congress would approve
a tax hike.
What is the logic of this provision?
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