04 juin 2008
Feedback: Cigarette Tax Goes Up
Smokers in New York now pay the highest tax on cigarettes in the country.
The latest increase of $1.25 means smokers will be paying a total of $2.75 a pack just in taxes.
The average cost of a pack of smokes is now just under $7 statewide.
In New York City, which has its own cigarette tax, the cost of a pack could soar past $10.
The state health commissioner thinks the increase will convince an estimated 140,000 New Yorkers to stop smoking.
But, Francis Gray of Gray’s Wholesale in Clayton doesn’t think it will make people kick the habit.
He supplies cigarettes to north country retailers.
About 50 percent of his annual business comes from cigarettes.
He says the last time the state increased taxes on a pack of smokes six years ago, his sales dropped 15 to 20 percent.
Now Gray is bracing for the same downturn.
He says the higher tax will just drive smokers toward places that don’t charge the tax: Native American stores and bootleggers.
“We make a few more cents a carton, but the volume goes down. New York state collects more on each carton, but they have fewer cartons to collect it on because all of the illegal cigarettes and the cigarettes from the reservation - they’re collecting zero on,” said Gray.
State officials also say the increase should bring in $265 million a year in additional revenue.
Cigarette taxes already generate more than $1 billion for the state.