Friday, April 12, 2013

Nice map showing each States level of taxation on a pack of cigarettes. I am quite surprised how LOW the taxes are in many States.

One way to discourage the consumption of a good that imposes negative outcomes on individuals, but perhaps more importantly on society at large, is to impose a tax on the good proportionate to the damage it creates. 

Cigarettes seem to be a good that is ripe for taxation of this sort.  As you can see from the map below the level of taxes imposed on a pack of cigarettes varies a lot across state lines.

Keep in mind the numbers you see are taxes levied by the each State.

There is also a $1.01 FEDERAL tax levied on a pack as well.  So, add that to the number in the map to get the total level of taxation.

Observations:  (1) Taxes in the tobacco producing States have VERY low State taxes on cigarettes.  Probably should be no surprise there.  Having said that, what is up with Missouri ("MO")?? Seventeen cents? (2)  States with low level of taxes on cigarettes are States known to have, in general, the poorest individual (and collective) health outcomes overall.  I am not suggesting low taxes on cigarettes are the cause...but it certainly does not help, it seems.

Source: KPC

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