Excise Taxes

National

Senate approves budget, backs tobacco tax hike
The U.S. Senate approved the fiscal 2008 budget that calls for an increase in the federal tobacco tax. The 39 cent per pack tobacco tax increase would be used to finance and expand the State Children’s Health Insurance Program, which provides health care coverage for poor children. The U.S. House of Representatives is considering its version of the budget and the two chambers will need to work out any differences. Click here to read more.

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States

In Texas, cigarette tax sales up $53.3 million in new year
In the first two months since the $1 per pack tax increase took effect in Texas, the state has collected about $53.5 million more in tobacco tax revenue compared to the same period in 2006, according to a report from the comptroller’s office. Cigarette sales in convenience stores are down 12% statewide and store owners near bordering states with cheaper taxes report even steeper losses. The tax was passed in an effort to offset cuts in local property taxes and is projected to raise $1 billion by the end of the fiscal year. Click here for more information.

Tobacco industry mobilizes to fight a proposed tax hike in Maine
The Maine legislature is considering increasing the state tobacco tax by $1 per pack, giving Maine the highest state cigarette tax in the nation. The measure is being met with heavy opposition from Philip Morris USA and R.J. Reynolds who are enlisting cigarette wholesalers and retailers to join the fight against the measure. Leaders for the Democrats are sighting a lack of support for the measure in either chamber. Click here to read more.

Iowa passed $1 per pack tobacco tax increase
Both the Iowa Senate and House have approved a one-dollar per pack increase in Iowa’s tobacco tax, the measure has been signed by Governor Culver, and put into effect. This is the first increase in Iowa’s tobacco tax since 1991. The tax increase is expected to reduce cigarette consumption by about 70 million packs in the state. Already, Quitline Iowa has reported a dramatic increase in the number of calls.  Click here to read more.

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International

Excise duties: Chancellor’s tax double-whammy to persuade smokers to give up
In England, beginning July 1st, the price of cigarettes will rise by 11 percent while the tax on nicotine replacement products will drop from 17.5 percent to 5 percent. The government has stepped up its anti-smoking campaign in an effort to encourage more people to kick the habit ahead of the implementation of the smoking ban in July. The deputy chairmen of the British Medical Association criticized the inflation-linked tax increase, stating the increase should have been greater, as an effort to encourage more people to quit smoking. Click here to read more.

Indian government hikes excise duty on cigarettes, bidis
Finance Minister P Chidambaram has increased excise duty on cigarettes and bidis about 5 percent, showing his support of the campaign “say no to tobacco”. Click here for the press release.

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