Federal Tobacco Tax Increase could Help Smokers Quit
In Florida cigarettes have been inexpensive addiction for smokers, even a cig pack cost $4 for most brands. In this state the cigarette tax was not introduced, that’s why in Florida cigarettes were cheapest.
But soon smokers from Florida will also suffer because of cigarette tax. On April 1, the federal excise tax on cigarette will raise to $1.01 a pack, up 62 cents from the current level, and the Florida Legislature is considering a $1-a-pack increase in the state tax. But many cig brands in Florida could cost $5 a pack.
Major Tobacco Companies, which expect to sell fewer cigarettes under the new tax, have already raised prices to boost revenue ahead of next month’s federal increase.
For example, Philip Morris USA raised the price of Marlboro, Virginia Slims and other brands by 71 cents a pack March 9 and other tobacco companies have followed during the past week.
A manager at Tobacco Depot said that the new low will impact their business because many of the manufacturers have increased prices and they have been forced to absorb the costs.
Some argue that the government is too dependent on “sin” taxes and that the increases, whether state or federal, will create a hardship on the people who can least afford it.
After the increased cost to consumers, the higher prices will result in a 10 percent decline in cigarette sales and risk of loosing 117,000 jobs across the country, according to the National Association of Tobacco Outlets.
Not only cigarettes prices will be increased but also the prices of other smoking products, such as cigars, pipe tobacco, chewing tobacco. For example the federal government will raise the tax on large cigars to 40 cents apiece, up from 5 cents. Pipe tobacco will increase from $1.10 to $2.83. Chewing tobacco will increase from 19 cents a pound to 50 cents a pound.
Smokers said that for them the cigarette taxes increase is not a problem, but they resented because Government turn to tobacco whenever they need money.
Retailers also worry that the tax increases will drive customers to online tobacco stores or Indian reservations in search of lower-priced cigarettes.
Source: Cigs4us
