Will cigarette tax increase revenue?

0324-cigarette-taxA huge chunk of Gov. Bentley’s proposed tax increase comes from raising the tax on cigarettes. How effective would this really be on raising revenue?

The Governor has proposed increasing the tax on cigarettes by 82.5 cents per pack. Currently, it is 42.5 cents, so the new tax would be $1.25. While still less than the national average, this would be significantly higher than the tax per pack in Georgia, Tennessee, and Mississippi. In fact, the tax per pack in Georgia would be 88 cents less, assuming those Bulldogs don’t jack up their rates any time soon. ( Link to full article as previously published in the Montgomery Advertiser Saturday May 16th)

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees.