October 14, 2010

Cigarette Sales in Massashusetts

Interesting article, cliik here from the DOR   Quick summary....    Revenue Collections for cigarettes
      • fiscal   2007  --     419.7 million
      • fiscal   2008  --      pretty much the same
      • fiscal  2009 -- a buck per tax excise tax was added and revenues increased to 569 million
      • fiscal  2010  --  estimated to come in at  547 million
It is also estimated that the Commonwealth currently sells 217 million packs per year.  A 22% drop in sales the past two years since the new excise tax was added.

7 comments:

Steve Foley said...

If the sales are 217 million packs per month, and there is a $1 per pack tax, why isn't the revenue 217 million (per month ) times 12 , or $2,604,000,000 (2.6 billion) ?

Bill Randell said...

Steve


If you read the press release it is per year. I typed in wrong and have changed it.

Thanks

Bill

jahn said...

What was the excise per pack prior to the 2009 increase of $1.00per pack?

Bill Randell said...

Not sure

This increase was one of the largest that I can rememeber of the last 20 years and cut sale almost 25%

Steve Foley said...

If they are expecting $569 million in revenue on 217 million packs, it looks like they're getting $2.52/pack in taxes. That would have been $1.52 before the increase.

They should also claim credit for increased gasoline tax revenues from all the people driving to NH for cigarettes and liquor.

Pete said...

Well Bill you can't assume that the 22% reduction of sales is entirely related to the tax. don' make assumptions like that just to support your point (although I do agree with you that a good chunk of the 22% is probably related to the increase in tax). However, i do know that smoking rates have generally been declining for the past 20 years. So I'm sure even without the tax, there would have been a decline over the last 2 years. so how much of the decline is due to the tax and how much is due to natural decline? there is no way to know for sure.

Bill Randell said...

Pete:

A 22% reduction once the new excise tax started indicates people are buying cigarettes elsewhere.

Granted some people have stopped smoking so the percentage would be less, but I think these numbers support my point that people are going outside Masschusetts to buy cigarettes.

Seriously the next 5 people you know who smoke, ask them where they buy their cigs.

Bill