Sales of illicit cigarettes have been rising in New York City for more than 10 years and now outnumber sales of licit cigarettes, according to a story by Gregory Bresiger for the New York Post quoting Scott Drenkard of the Tax Foundation.
New York had “the worst smuggling problem in America,” said Drenkard, adding that the least a smoker could now legally pay for a pack in New York City was $13, which was recently raised from $10.50.
Cigarette taxes and a new minimum price rule have raised the price of a pack by about 200 percent over the past decade.
Consequently, smugglers buy cigarettes in a low-tax state such as Virginia, which imposes a 30-cent tax, and sells them in New York, where the combined city-and-state tax is £5.85.
“Price disparities create incentives for illegal activity,” said Kim Kessler, assistant commissioner for the bureau of chronic disease prevention and tobacco control, NYC Health Department.
“But we know that despite this activity, raising the price of tobacco products still reduces consumption. The lives we save by raising the price of tobacco far outweigh any lost taxes due to illegal sales,” Kessler told The Post.
“The adult smoking rate has decreased from 21.5 percent in 2002 to 13.1 percent in 2016. Increasing the cigarette price floor to $13 is projected to lead to a 6.4 percent decline in adult cigarette smoking.”
Consuming question
