|
State Tobacco Tax Trends 2002-2008
States continue to look at tobacco taxes, primarily the tax on cigarettes, to balance budgets or fund program priorities, often for health-related programs. To date this year, a handful of states considered tobacco tax changes, with Massachusetts approving a $1 per pack cigarette tax increase, estimated to generate $175 million; and New York passing a $1.25 per pack increase, projected to raise $265 million. New Hampshire approved a conditional 25 cent per pack increase that is tied to revenue performance in the fall of 2008. Proposals were also discussed but not approved in Florida, Kentucky, South Carolina, Oregon, and other states.
Most states have adjusted tobacco tax rates one or more times since 2002. Here are the statistics on actions taken by state legislatures or voters in recent years, including the number of states increasing taxes and the total expected revenue from all those states:
| Year |
Number of States Acting |
Estimated Revenue Increase |
| 2008 |
2 states |
$440 million |
| 2007 |
11 states |
$1.1 billion |
| 2006 |
5 states |
$710 million |
| 2005 |
8 states |
$1.2 billion |
| 2004 |
9 states |
$709 million |
| 2003 |
19 states |
$891 million |
| 2002 |
20 states |
$3 billion |
Source: NCSL "State Tax Actions", various years.
In related excise tax news, this year in Maine a cigarette tax increase was proposed to help fund its state-sponsored health plan, but by session's end lawmakers approved tax increases on beer, wine, and soda syrup instead of on cigarettes.
For more information, see "State Tax Actions 2008" (forthcoming from NCSL in early 2009).
Posted September 22, 2008.
Email statetax-info@ncsl.org for more information.
|