Cigarette Tax Fallout

It’s been nearly one month since Nevada’s cigarette excise tax increase went into effect, raising the average pack price from $5 to $6. The $1 per pack tax hike represents the state’s largest single cigarette-tax increase and its first tax hike since 2003. Not surprisingly, tobacco retailers are concerned about what this means for business. “I think it (cigarette use) will decline, it will decline substantially,” Steve Moran, director of business enterprise and economic development for the Reno-Sparks Indian Colony (a major tobacco player in the state) told the Reno Gazette-Journal. “This is a substantial increase (in taxes).” Retailers in Kansas have expressed similar concerns after lawmakers enacted a similar excise tax increase in June, increasing cigarette taxes by 63% (from 79 cents per pack to $1.29 per pack). The Kansas tax revenue is slotted to cover a $400 million budget deficit, while Nevada’s additional revenue will likely go towards a $1.3 billion increase in educational funding.

http://www.cspnet.com/category-news/tobacco/articles/kansas-nevada-brace-cigarette-tax-fallout