Tobacco Taxes on the Rise
Tobacco made headlines this week when President Obama signed legislation authorizing FDA regulation of the tobacco industry. A lesser reported tobacco story is the tax hit smokers are taking in this economy.
47 states face major budget deficits, and no one has the stomach for broad income, property or sales tax hikes, particuarly since we're trying to claw our way out of the downturn. Thus, "sin taxes" are one of the few politically viable ways to generate revenue and narrow groups may end up shouldering a disproportionate share of the budget gap burden.
Here's an excerpt from a Stateline.org article on the topic:
"For lawmakers scrounging to balance state budgets in a recession, tobacco taxes were one of the most popular options on the table this year. Seven states — Arkansas, Florida, Hawaii, Kentucky, Mississippi, Rhode Island and Vermont — tapped smokers’ wallets to help fill their budget gaps, up from two states in 2008. More than 20 additional states debated whether to follow suit, according to the National Conference of State Legislatures."
The same Stateline article includes a chart listing all the state cigarette taxes, from the lowest in South Carolina ($.07 per pack) the the highest in New York ($2.75 per pack). Click HERE.