Posts Tagged ‘cigarette tax’

Capitol Confidential

It’s Not Just Blue States Looking at Tax Hikes for Cigarettes in 2012

by Capitol Confidential

Across the United States, Idaho is typically known for two things: Potatoes, and its conservative political tendencies.

Indeed, in 2010, only Wyoming bested the Gem State in terms of “redness.” So, suffice to say, Idaho is no Maryland.

However, it turns out the two states do have something in common: Both are looking at potential big increases in their respective cigarette taxes as legislators get ready for the 2012 session.

As previously noted here, a push is being made in Maryland to raise the state’s tobacco tax by $1 per pack.

Now, Idaho Rep. Dennis Lake, who is the Chair of Idaho’s House Revenue and Taxation Committee, is planning to try again for a cigarette tax hike he pushed last year — with no success. Lake is reportedly looking to raise the state cigarette tax by $1.25 per pack. Proponents claim the proposed tax hike could bring in more than $50 million a year in new revenue, though other states have not always met revenue targets associated with cigarette tax increases.

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Capitol Confidential

Dems Pursue Tax Hike on the Poor

by Capitol Confidential

President Obama called for tax hikes worth $1.5 trillion on Monday, but in a less remarked-upon move, members of Democratic leadership in the U.S. Senate have also been pushing for tax increases of their own.  However, unlike Obama’s proposal, which is squarely focused on enhancing the revenue that upper-income taxpayers are required to pay out, the proposal being pushed by Sens. Durbin, Murray and Begich (respectively, the Assistant Majority Leader, the Secretary of the Conference and the Chair of the Steering and Outreach Committee) aims to raise taxes significantly on some of the poorest Americans.

Via the Winston-Salem Journal:

A group of 14 U.S. senators — all Democrats — are using a familiar strategy as they try to raise the federal excise tax on tobacco products.

Senate Bill 1403 would provide annual funding to the Individuals with Disabilities Education Act by essentially doubling the excise tax on cigarettes and small cigars.

[...]

For example, the federal excise tax for cigarettes would go from $1.006 a pack to $2.01.

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Capitol Confidential

New York Considers Hiking Cigarette Tax…Again

by Capitol Confidential

Despite the economic climate and anti-tax wave rolling across the country, New York is once again proposing tax hikes on tobacco. Senate Bill S. 2981 would add an additional $1.65 tax to the already staggering $4.35 the state levies in taxes on a pack of cigarettes—a move likely to upset smokers in the Empire State and potentially deliver little additional revenue to the state’s coffers.

Since raising its tobacco tax last year, New York has seen cigarette sales plummet, as of November 2010, by a whopping 27 percent. Meanwhile, both Pennsylvania and Vermont have seen their cigarette sales rise as New Yorkers looking for a bargain have crossed the border to load up on smokes, thus depriving the state of revenue some had hoped would help it close its yawning budget gap.

Some observers believe that this time, if another hike is put through, the state could actually lose money.  Several Northeastern states– New Jersey, New Hampshire and Rhode Island– have been exploring the idea of reducing the tax they levy on each pack of cigarettes to spur economic recovery and enhance revenues.  A recent study conducted in New Hampshire demonstrated that a 10 cent cut could result in additional tax money flowing to the state’s treasury.

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Capitol Confidential

New York Targets Bagels to Fill Budget Hole

by Capitol Confidential

New York, like most states in the nation, is facing a nasty budget hole which Gov. David Paterson attempted to fix earlier this summer by pushing through a tax hike on cigarettes.  A pack of smokes now costs as much as $13 in Manhattan, but the high taxes being levied may not be helping to close the state’s budget gap.  Revenue from cigarette sales following implementation of the 58 percent increase in tax levied by New York State totaled $125 million last month.  During July 2009, it totaled $119 million.

Now, facing ongoing budget problems, New York is moving to impose taxes on a good the state is known for producing, and which many of its residents consider indispensible: The bagel.

bagels

An obscure provision in New York’s tax law allows Albany to tax “sliced or prepared bagels (with cream cheese or other toppings),” and the tax collectors are moving on bagel shops across the state.  A particular target appears to be Kenneth Greene, who owns over thirty Bruegger’s Bagel franchises in New York.  Greene’s customers are livid at the eight-cent per bagel tax being levied.  In response to customer outrage, Greene has posted signs reading “We apologize for this change and share in your frustration on this additional tax.”

Other bagel shop owners meanwhile are holding out hope the tax collectors refrain from targeting them next.  “I hope they don’t come after me for that,” said Florence Wilpon, a founding owner of Ess-a-Bagel in Manhattan, per a quote in the Wall Street Journal.

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