In 2006 Governor Mitch Daniels was a hero to the taxpayers of Indiana when he demonstrated his strong commitment to free market principles and lead the fight to increase cable competition. This year it appears Governor Daniels is taking a step back with his support of Senate Bill 503. This bill would raise taxes on cigarette smokers to pay for a new program.

FreedomWorks actively opposes all tax increases and believes local, state, and federal taxes have grown too burdensome and government too large. Indiana politicians need to understand how to live within their means and realize that government does not have a revenue problem, it has a spending problem. FreedomWorks has a long history of reminding elected conservatives about limited government values. When traditional allies in the governors’ mansions of Colorado and Alabama strayed on tax policy in recent years, FreedomWorks activists were out front fighting to stop the expansion of government.

FreedomWorks Chairman and former Majority Leader Dick Armey commented,

“Unfortunately it seems Gov. Daniels has turned to drinking some backsliders wine this year and is looking to increase taxes in order to fund his new health care plan. Specifically, Gov. Daniels is calling for a $0.25 per pack cigarette tax hike that would not just punish smokers, but all Indianans and the state economy as a whole.”

“While smokers may seem like easy targets for those looking to raise revenue, excise tax hikes like this one end up hurting small business owners such as convenience store and tavern owners, who see sales drop due to smokers buying cigarettes online or from nearby states with lower tax rates like Kentucky.”

“Because cigarette taxes have historically been an unreliable source of revenue, government programs that the tax was supposed to cover wind up under funded and lawmakers scramble to make up the difference with other tax hikes or fee increases; the bottom-line is taxpayers wind up footing the bill as usual.”

FreedomWorks will engage a multi-pronged grassroots campaign that will mobilize activists to write, email, call, and personally visit policy makers, including Governor Daniels, to voice their opposition to the new tax scheme. FreedomWorks Chairman Dick Armey will also send a letter to Governor Daniels outlining his concerns with the tax hike.