Instead of buying tobacco in supermarkets or corner shops, she will Google “cheap cigarettes” on the Internet and buy her Marlboros on-line, using one of the hundreds of illegal foreign-based websites that ship discounted cigarettes form countries where taxes are much lower.

Quitting never really crossed her mind.

“I can’t smoke in offices, bars, restaurants, not even at the bus stop,” an upset Briles, 20, from San Francisco, said. “Now they’re putting up prices, forcing me to buy cigarettes illegally. How much more do they want to take from me?”

Briles is one of many California smokers who feel Proposition 86 is invading their personal space.

But not all view the tax hike in a negative light.

“I don’t want to see young people smoke,” said Carolyn Schlaefer, 57, from Redwood Shores. “I think if cigarette prices go up, then people will think twice before buying them, or might cut down on consumption,” she said.

Schlaefer, a smoker for over 40 years, said she would probably quit if Proposition 86 passed. But she also said she wished some parts of the bill were better thought out, focusing more on prevention programs.

Briles and Schlaefer’s reactions mirror just how divisive the issue of increasing taxes on cigarettes has become.

Proposition 86 would add a $2.60-per-pack tax on top of the current state levy of 87 cents – making it the nation’s highest rate. The tax would apply to all tobacco products, including cigars.

Starting in January 2007, smokers would pay an average of $6.60 for a pack of cigarettes. The money – an estimated $2.1 billion annually for 2007-2008, though that amount would decline over time – would be used to fund several health programs, children’s health coverage and tobacco-prevention activities.

While supporters hail the impact that the measure would have on California’s strained health resources, critics argue too much money is being allocated to programs and activities not directly related to smoking. While one-fifth of the money would go to tobacco control and anti-cancer efforts, a third would go to emergency room care and a fifth would fund health insurance protection plans for children.

“What’s happening here, is that money is being transferred from smokers to non-smokers,” said Patrick Fleenor, chief economist at the Tax Foundation, a nonpartisan tax watchdog based in Washington, DC, which opposes the measure.

Auday Arabo, president and CEO of the California Independent Grocers and Convenience Stores, agrees. “It’s a monster initiative,” he said. “It’s not the tax increase that bothers me – the intent is great – it’s about where the money is going. The biggest pitfall is that everyone is trying to get a piece of the pie,” he said.

Those who oppose the measure, namely tobacco companies and smaller business groups, accuse big hospital corporations of trying to secure funding for their own services through an unjustified tax hike. They also complain about lack of accountability to taxpayers and argue low-income smokers would be the first victims of the Proposition.

But promoters – which include the California Hospital Association, the American Cancer Society and the American Heart Association as well as several other medical and health groups – say the measure will help reduce smoking while addressing the state’s most urgent health care needs.

“Tobacco companies and their supporters would say anything to undermine our effort, but I don’t understand their critique,” said Peter Warren, of the California Medical Association. “The truth is that tobacco causes heart disease, lung cancer and other health problems. Meanwhile, our emergency room system is in trouble – 65 of them have closed down since 2000 – and there are currently 3 million uninsured children”.

Warren said it’s reasonable not to spend all the money on prevention because Proposition 86 is already by itself a prevention measure. “We have desperate health care needs and we think it’s appropriate to get funding from taxes on cigarettes,” he said.

Both sides have been investing massively to advance their campaigns. Opponents have poured in $58 million, mostly from Philip Morris and R.J. Reynolds tobacco companies. Supporters, led by California hospitals, have spent more than $13 million to get the measure passed.

Besides health care professionals, among the strongest supporters of Proposition 86 are ethnic minorities, who are much more likely to be uninsured than non-minority groups and would thus greatly benefit from the bill, according to Katherine Culliton, policy director at the National Latino Council on Alcohol and Tobacco Prevention, a non-profit organization based in Washington, DC.

“Proposition 86 would help to remedy the exploitation of our community by the tobacco industry,” Culliton said, noting that tobacco companies tend to target youth in large, fast-growing minorities because their traditional white market is shrinking. “We’re glad the money is coming back to the community and going towards people with no health insurance,” she said.

How money would be spent is not the only controversial issue about the bill.

Critics of Proposition 86 warn the measure would have a devastating impact on crime, leading to increased robberies and smuggling incidents.

“As the US already experienced with Prohibition and high taxes on alcohol, the consequences may outweigh the benefits,” said Fleenor, referring to the prohibition era in the 20’s which saw a mushrooming of illegal drinking joints, home-produced alcohol and gangsters.

“What we’re going to see is an increase in crime and smuggling and more and more people illegally buying cigarettes on-line,” he said, pointing to the fact that if Proposition 86 passes, smokers could save as much as $50 on every cartoon of cigarettes purchased on-line rather than locally.

According to the Washington-based economist, the nearly 300% tax increase on cigarettes would give bootleggers smuggling cigarettes from other states as much as $700,000 on every tractor-trailer load of cigarettes. If imported to California from abroad, the potential illicit profits would soar to $1.2 million, Fleenor said. Value of cartons in stores and warehouses would also increase, making them an easy target for robbers and thieves, he warned.

Fleenor says tax hikes on cigarettes – there have been three in California recently, in 1996, 2000 and 2001 – have never really worked in terms of having people quit smoking. “Smokers simply flocked to military bases or Indian lands when these areas were tax exempt, and later to the Internet,” he said.

However, supporters of Proposition 86 insist that previous efforts have proved successful.

“Measures approved in the past decade have led to a 62% decrease in tobacco consumption,” said Maria Robles, a registered nurse who works on the “Yes to Prop 86” campaign. “Since 2002, 42 other states have followed our example and passed a cigarette tax,” she said. “At the end of the day, it’s about priorities. And our priority is to save lives and build better health.”

Another concern is the effect Proposition 86 would have on businesses.

There are currently about 38,000 licensed tobacco retailers in California, according to officials at the California State Board of Equalization.

Many fear the measure would hit hard on cigarettes sales, which are often the main source of revenues for smaller stores.

“I don’t smoke and I wish nobody did, but I’ll lose a lot of customers if this bill is passed” said Nizar Askndafr, from Syria, who owns a small liquor store in downtown San Francisco. “Smoking kills, but in this way, they’ll kill us, they’ll kill our business,” he said.

According to Arabo, the head of the California Independent Grocers and Convenience Stores, consequences for retailers would be severe, forcing many shop owners out of business. “People who smoke will continue to smoke,” he said. “Who loses will be retailers and the State of California.”

Supporters of Proposition 86 point to the numbers, arguing that with an estimated $8.6 billion a year in smoking-related health costs, the State can only benefit from increased taxes, which would help reduce tobacco consumption.

They cite a study by the California Department of Health Services, which says Proposition 86 would reduce the number of cigarettes consumed in the state by more than 26 percent, or one quarter. The measure would keep 700,000 youngsters from becoming adult smokers and prevent 300,000 smoking-related deaths, the study says. It would also save over $16 billion in health care cost, according to the same report.

Today, an estimated 20.9% of all adults in the US (about 44 million people) smoke, according to figures from the National Center for Chronic Disease Prevention and Health Promotion show.

With 18.5% of adult smokers (about 6 million people), California has one of the lowest smoking rates in the country, but tobacco remains the top cause of preventable death and disease in the state, according to the California Department of Health Services.

World-wide, Norway and Britain are among the countries with the most expensive cigarettes. In London, a pack costs 5.20 pounds (nearly $10) – about twice as much as in the United States.