Tuesday, June 22, 2010

NY: Get Ready for $11 a Pack Cigarettes

Yesterday legislators from New York passed a bill that will levy an additional $1.60 in excise taxes on every pack of cigarettes sold in the state. The new tax is scheduled to take effect July 1st, and will increase the total taxes on a pack of cigarettes to $11. Check out the following CNNMoney.com article on this recent development.

New York City smokers already pay the highest cigarette taxes in the nation, but a new state law will push those taxes even higher this summer.

The state legislature on Monday approved a bill adding an additional state tax of $1.60 to every pack sold, effective July 1. This bill, which was signed by Gov. David Paterson on Monday, will raise the state tax to $4.35 per pack.

New York City smokers pay an additional municipal tax of $1.50 per pack, for a current total tax of $4.25 per pack. That's the highest state-local tax whammy in the country, according to the Campaign for Tobacco-Free Kids. Chicago is the runner-up, at $3.66 per pack.

This new tax increase means that smokers in the city will pay $5.85 per pack in taxes. This drives the average local price up to nearly $11 per pack, according to some estimates.

The tax hike is aimed at generating an additional $440 million in 2010-2011 tax revenue to support healthcare programs.

The bill also requires that taxes to be imposed on cigarettes sold at Indian reservations, including the Shinnecock Indian Nation, which was recently recognized by the federal government.

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