06:31 PM CDT on Tuesday, April 25, 2006

By LEE MCGUIRE / KVUE News

Bleary-eyed state lawmakers took time off Tuesday, after staying up late Monday night to pass a series of bills designed to lower your property taxes.

One part of the plan didn't pass -- an increase in the cigarette tax. But that doesn't mean it's out.

House lawmakers liked the tax but not the phase-in. And for now, that was enough to kill it.

"If we're gonna do that, we might as well just put puppet strings on ourselves and be puppets," said State Rep. John Smithee, (R) Amarillo.

Puppets of the tobacco industry. Just before midnight Monday, a floor fight erupted over a dollar-per-pack increase in the cigarette tax. Not because lawmakers didn't want to tax cigarettes, but because many didn't like the way tax would be introduced.

Many smokers opposed it from the start.

"I don't feel that I should be subsidizing people's property taxes," said Betty O'Callaghan, smoker.

Jack Parks told KVUE News, "Well, it's obviously an addiction and I don't feel that people should be subsidized for that."

Governor Rick Perry proposed the higher tax both to raise money for property tax cuts, and, he said, to shock smokers into quitting. The shock value came in the timing.

His plan would have immediately raised the taxes to $1.41 per pack. But some House Republicans, tried to phase the tax hike in gradually, over three years. The phase-in was first suggested by the tobacco industry, to keep cigarette sales from declining.

And that's what pushed many lawmakers over the edge.

"Here we are selling bonds basically to satisfy the tobacco industry," Smithee said.

Houston Republican Peggy Hamric proposed the phase-in plan. Austin Democrat Dawnna Dukes asked Hamric if she believed what the governor did -- that people might quit smoking if the tax increase took effect all at once.

"I don't think that's a valid, I don't know there are a lot of rich people who smoke there are a lot of middle class people who smoke and whether at what degree a tax actually people will quit. I don't know," Hamric said.

Hamric says she's concerned that if too many people quit smoking, the state would lose tax dollars down the road.

Lawmakers will re-introduce that cigarette tax hike on Thursday.

Most likely, the dollar-per-pack increase would take effect immediately, if it passes the full legislature.