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EDITORIAL: Pennsylvania's tobacco tax revenues going up in smoke 

A big part of Pennsylvania's budget deficit fix might be going up in smoke, literally. Faced with higher cigarette taxes, smokers are seeking cheaper alternatives that could affect the state's anticipated tobacco tax revenues by millions of dollars. . .

And here's an ironic twist on the sales by Internet sites. Many of them are operated by Indian reservations where tobacco sales are exempt from state and local taxes. Native Americans operating these sites argue those sales should be tax exempt also. If that argument holds, descendants of those who introduced the world to tobacco hundreds of years ago might end up being big beneficiaries of the state's lousy economic health.

This year 17 states hiked cigarette taxes, including neighboring New York and New Jersey. The federal government estimates Internet sales will cost states $1.5 billion in taxes. That could make $617 million seem like a pipe dream. What will fill the budget hole next year?

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