Cigarette tax revenue plunges as smokers buy outside NY

[GURPS]

Shocker: New York state cigarette tax collections have plunged by about $400 million over the past five years, says the New York Post. Cigarettes are over $10 a pack there with most of that going to taxes. The decline in revenue is blamed on more cigarettes being bought cheaper out of state and 19 percent of smokers just quit. Raise your hand if you predicted this. Raise both hands if your cat could’ve predicted it.



Cigarette tax revenue plunges as smokers buy outside New York


Albany has really blown it — tax revenues from cigarettes are up in smoke.

New York state cigarette tax collections have plunged by about $400 million over the past five years, according to figures and estimates from the office of New York State Comptroller Thomas DiNapoli.

And New York has also lost $1.3 billion in uncollected state cigarette taxes each year from alternative sales, according to a separate study.

The state is taxing far fewer packs, as smokers evade taxed packs, shop across state lines or buy smokes from Native American merchants to avoid punitive NY taxes. A typical pack in New York costs $10.60 or more, including the nation’s highest state excise tax, $4.35.

 

[Pete]

But that is OK because the health benefits of making cigarettes too expensive was really, no ####, 100% genuine desire of liberals in NY. they don't need that blood money!

 

[glhs837]

No, because you know damn well they put those revenues into the projected budget numbers, and now that money will have to come from somewhere else.

 

[b23hqb]

Let the NY taxpayer dwell on that old phrase "Caveat Emptor" when it comes time to vote. Fat chance, right?

 

[tommyjo]

Gee...why would anyone bother to check sales figures for cigarettes when it is simply so much easier just to jump to an idiotic political talking point?

According to the Alcohol and Tobacco tax and trade bureau (TTB), cigarette sales nationally have dropped by 44% from 2004 thru 2014 (last full year stats are available).

http://www.ttb.gov/statistics/tob_dec04.pdf

http://www.ttb.gov/statistics/2014/201412tobacco.pdf

Also according to the CDC:

Cost of Smoking-Related Illness


•Smoking-related illness in the United States costs more than $300 billion each year, including:3,4
◦Nearly $170 billion for direct medical care for adults
◦More than $156 billion in lost productivity, including $5.6 billion in lost productivity due to secondhand smoke exposure

http://www.cdc.gov/tobacco/data_statistics/fact_sheets/economics/econ_facts/index.htm

 

[itsbob]

Gee...why would anyone bother to check sales figures for cigarettes when it is simply so much easier just to jump to an idiotic political talking point?

According to the Alcohol and Tobacco tax and trade bureau (TTB), cigarette sales nationally have dropped by 44% from 2004 thru 2014 (last full year stats are available).

http://www.ttb.gov/statistics/tob_dec04.pdf

http://www.ttb.gov/statistics/2014/201412tobacco.pdf

Also according to the CDC:



http://www.cdc.gov/tobacco/data_statistics/fact_sheets/economics/econ_facts/index.htm

So you're saying a smoker on the border of NY and PA wouldn't cross the border to save $50 a carton on smokes?? Is there some kind of secret invisible cigarette shield preventing them from doing so??

I'd say they are losing a crapton of money to neighboring states if only you take into account those smokers living within 15 miles of another states border..


Most states recognize this as a fact of life and prey on out of staters to line their coffers with out of state money.

 

[vraiblonde]

Shocker: New York state cigarette tax collections have plunged by about $400 million over the past five years, says the New York Post. Cigarettes are over $10 a pack there with most of that going to taxes. The decline in revenue is blamed on more cigarettes being bought cheaper out of state and 19 percent of smokers just quit. Raise your hand if you predicted this. Raise both hands if your cat could’ve predicted it.



Cigarette tax revenue plunges as smokers buy outside New York


Albany has really blown it — tax revenues from cigarettes are up in smoke.

New York state cigarette tax collections have plunged by about $400 million over the past five years, according to figures and estimates from the office of New York State Comptroller Thomas DiNapoli.

And New York has also lost $1.3 billion in uncollected state cigarette taxes each year from alternative sales, according to a separate study.

The state is taxing far fewer packs, as smokers evade taxed packs, shop across state lines or buy smokes from Native American merchants to avoid punitive NY taxes. A typical pack in New York costs $10.60 or more, including the nation’s highest state excise tax, $4.35.

Not to mention guys sell cigarettes on the street and cops come, put them in a choke hold, and kill them.

Cigarettes kill, people!

 

[GURPS]

So you're saying a smoker on the border of NY and PA wouldn't cross the border to save $50 a carton on smokes??

actually if you can get on a reservation you can get your smokes tax free
[I thought New york has made regulations to block access]


http://wivb.com/2015/02/10/majority-of-wny-smokers-buy-at-reservations/
http://www.nytimes.com/2002/07/08/n...ers-flocking-reservations-buy-cigarettes.html

 

[SamSpade]

Gee...why would anyone bother to check sales figures for cigarettes when it is simply so much easier just to jump to an idiotic political talking point?

According to the Alcohol and Tobacco tax and trade bureau (TTB), cigarette sales nationally have dropped by 44% from 2004 thru 2014 (last full year stats are available).

That's because in 2009, the largest tobacco tax in history went into effect. That year, tobacco sales AND taxes took a nosedive when average price of a pack increase over 2 bucks a pack. They've been climbing back slowly as people adjust to the increase, but the loss in tax revenue alone was tremendous.

http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=403

And I'm surprised at you, since you're generally astute about finances - "lost" revenue at the state level isn't going to be replaced by renewed productivity among workers. They lost revenue, and any "savings" - went to someone else. You can claim that it's a net gain, but the people in the state house aren't going to see any.

I used to live along the border between Massachusetts and New Hampshire. I know from first hand experience that sales of big ticket items such as TVs were terrible on the Massachusetts side, because you could drive five miles and pay no sales tax - at a store in the same franchise. I think it's a pretty safe bet that if you raise taxes enormously - like the fed did in 2009 - you're going to drive sales and tax revenue down. If you live in NYC - which has an ADDITIONAL tobacco tax on top of the state - it's not hard at all to go to Connecticut, New Jersey or Pennsylvania and just buy smokes there. Heck, my sister used to drive all the way down to North Carolina years ago just to save money on cigarettes.

 

[GURPS]

I think it's a pretty safe bet that if you raise taxes enormously - like the fed did in 2009 - you're going to drive sales and tax revenue down. If you live in NYC - which has an ADDITIONAL tobacco tax on top of the state - it's not hard at all to go to Connecticut, New Jersey or Pennsylvania and just buy smokes there.

Sam, I would call that common sense ... something politicians lack when it comes to revenue aka taxes

case in point ....

Oh look revenue from Gasoline Taxes is DOWN because the FED demanded higher fuel economy

 

[SamSpade]

Sam, I would call that common sense ... something politicians lack when it comes to revenue aka taxes

See, I always *thought* one of the purposes of 'sin' taxes was to simultaneously discourage the use of the taxed item while providing revenue to offset their cost to society. For example, gas taxes - tax it a lot, people drive less, roads don't need to be fixed as often.

But what HAPPENS is, governments rely on it as a revenue stream regardless of its intent and act as though they are thwarted when they're not bringing in the cash - such as lighter, less air polluting more efficient cars driving further on a gallon of gas, so governments want to tax the miles your car drives, by putting a device in your car to see how much you drive.

 

[Rommey]

See, I always *thought* one of the purposes of 'sin' taxes was to simultaneously discourage the use of the taxed item while providing revenue to offset their cost to society. For example, gas taxes - tax it a lot, people drive less, roads don't need to be fixed as often.

But what HAPPENS is, governments rely on it as a revenue stream regardless of its intent and act as though they are thwarted when they're not bringing in the cash - such as lighter, less air polluting more efficient cars driving further on a gallon of gas, so governments want to tax the miles your car drives, by putting a device in your car to see how much you drive.

I think you give them too much credit. They use simpleton math.
If they tax a widget @ $1 ea and that resulted in $1M in tax revenue, then of course if they raise the tax to $2 ea, they WILL receive $2M in tax revenue. So they go out and spend the $2M and act all confused when there is a shortfall.

 

[GURPS]

But what HAPPENS is, governments rely on it as a revenue stream regardless of its intent .....

Tobacco Settlement money ..... states were awash in so much cash, it got diverted to programs 'other than' healthcare .... then what happens when that money is gone

Clinton did the something similar to the states back in the 90's ..... funding to the states for more police,
ok great what about 2 yrs from now - Oh you need to fund the new officers after that ....