The Palmetto Insider

The blog of the South Carolina Policy Council

Unforseen Problems Result from Cigarette Tax Increases

with one comment

Here’s more proof of the negative consequences that result from increasing the cigarette tax. An excerpt from the piece:

As tax increases urge consumers to alter their behavior more and more, customers and retailers grow more willing to resort to illegal behavior to purchase cheaper cigarettes, such as purchasing them online or from stores that do not pay the taxes. A Chicago Tribune article reports:

75 percent of cigarettes smoked in Chicago come from packs that don’t bear city tax stamps. The rate of tax avoidance here dwarfs the national average of about 20 percent, he said. In New York City — the only place in the country where cigarette taxes are higher — the avoidance rate is about 50 percent, he said, still sharply lower than Chicago’s.

Policy makers should keep in mind that as cigarette taxes continue to increase, higher revenue will not indefinitely.

We blogged earlier this week on how smoking bans represent a violation of civil liberties.

As the Policy Council has previously reported, raising the cigarette tax would cost South Carolina 4,100 jobs.


Written by Geoff Pallay

October 23, 2009 at 2:47 pm

Posted in Uncategorized

One Response

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  1. […] This post was Twitted by scpolicycouncil […]

    Twitted by scpolicycouncil

    October 23, 2009 at 5:01 pm

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