Tobacco.org

Cigarette-tax strategy could backfire on states 

But in the wake of New York's decision this week to raise the state cigarette tax by $1.25, to $2.75 a pack - the highest in the country - the strategy is coming under more scrutiny from analysts and economists.

"On the surface, a tax increase may seem like a logical, straightforward way to bring more money into state coffers," said Alicia Hansen, an analyst for the Tax Foundation of Washington.

For example, the estimates of new revenue from the higher New York cigarette tax range from $265 million to $436 million a year. The primary use for the extra revenue is to pay for health-care investments, according to the budget agreement by the governor and legislature. . . .

Bill Godshall, the executive director of SmokeFree Pennsylvania, said that New York has been a leader in the three proven strategies for reducing smoking - a higher cigarette tax, smoke-free workplace laws and programs to prevent kids from smoking and to help smokers quit.

But New York also has the highest rate of cigarette smuggling in the country as well, Godshall said.

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