Tobacco tax.

03LSO-0097.C1

FISCAL NOTE (HB0062)

	FY 2004	FY 2005	FY 2006
NON-ADMINISTRATIVE IMPACT
Anticipated Revenue From:
WYO. TOBACCO SETTLE TRUST	20,267,500	4,732,500	0
WYO. TOBACCO SETTLE INCOME	0	15,535,000	15,800,000
GENERAL FUND	0	0	4,467,500

Source of revenue increase: Increase in the tobacco tax.

Assumptions:

1. Assumed a linear relationship between the current taxes collected and the percentage increase. Inflation is not factored in due to the anticipation of some decline in sales volume. This tobacco tax increase is estimated at $20,267,500 per year.

2. The Substance Abuse Control Plan is estimated to cost $15.2 million in FY 2004, $15.8 million in FY 2005, and $15.8 million in FY 2006. This estimate includes costs for Department of Health, Department of Family Services, and Department of Corrections.

3. The increased revenue from the tobacco tax is reflected in the table above, and is to be distributed as follows:

¨ The first $25 million collected shall be deposited into the Wyoming Tobacco Settlement Trust Fund Account (WYO. TOBACCO SETTLE TRUST).

¨ The remainder shall be transferred into the Wyoming Tobacco Settlement Trust Fund Income Account (WYO. TOBACCO SETTLE INCOME) in an amount necessary to fund the annual cost of the Substance Abuse Control Plan.

¨ Any funds remaining after funding the Substance Abuse Control Plan shall be deposited into the General Fund.

4. If there is a substantial reduction in sales volume because of the tax increase, there will not be a linear gain in revenue and general fund revenues could be decreased. This potential impact on overall revenue is indeterminable.

5. This bill is effective July 1, 2003.

Prepared by:   Dean Temte, LSO    Phone:   777-7881

(information provided by Dan Noble, Dept. of Revenue; phone 777-5220:

Diane Galloway, Dept. of Health; phone 777-6494)