What's on Tap for the 2006 Legislative Session?

The State's John O'Connor puts on his forecasting hat:

Debate should be short and sweet on most tax hikes this year; lawmakers said raising taxes with a $1.1 billion budget surplus would be nearly impossible. There likely will be extended debate on raising the state's cigarette tax. At 7 cents a pack, it's the lowest in the nation. The question is whether a cigarette tax increase would pay for health-care costs or whether it would be tied to a $205 million income tax cut as proposed by Gov. Mark Sanford.
Senate President Pro Tem Glenn McConnell, R-Charleston, and Majority Leader Harvey Peeler, R-Cherokee, said raising cigarette taxes has a chance only if connected to income tax cuts.
After the approval of $600 million in property tax relief and reduction of grocery sales taxes last year, less time will be spent on tax cuts this year. Harrell said the House will discuss further cutting the sales tax on groceries.
Proposals to raise South Carolina's relatively low taxes on gasoline or alcoholic beverages also could be introduced.

Leaving aside, for the moment, troubling questions of tax fairness, arguments could be made for increasing all three of the "sin taxes" discussed here. South Carolina is one of the few states that can plausibly claim some serious revenue raising potential from the cigarette tax. Their lowest-in the-nation tax rate could be jacked up substantially without further depressing cigarette consumption too much. And gasoline taxes need to be hiked every now and then to ensure an adequate supply of road funding.

But the real non-starter here is the idea of using cigarette taxes to fund an income tax cut. The income tax is a fair and sustainable revenue source. The cigarette tax is neither-- which means that even if lawmakers can put together a revenue-neutral tax swap in the short run, the long-term impact will likely be a growing budget hole.