This last cig tax increase was a killer. It made the spread to much and forced people, especially in tough economic times, to seek alternative ways to buy cigs. One of which was the state of New Hampshire.
Not only do you lose cig sales revenues, but when people go to New Hampshire they buy liquor and lottery too. Just read this in the Nashua Telegraph:
Cigarette sales brought in $20.1 million last month when only $18.3 had been expected.Likewise, liquor sales came in at $18.7 million; that was $3 million more than its forecast for December
Although there was an additional dollar per pack tax, the Commonwealth raised more money right? Wrong, from the Belmont Citizen Herald:
State finance documents project a decline in tax collections of about 3.6 percent for fiscal 2009, instead of the assumed 3.8 percent growth
Think about that, the Commonwealth added a dollar per pack tax to cigs to raise revenues to fund the new Commonwealth of Massachusetts health reform law and not only have they not raised more money, but actually collected less. At the same time New Hampshire collected 10% more then expected.
Jahn, what do you think really happened here.
WRRB/Telegram District City Council Forum 10/18
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6 months ago
3 comments:
I wonder what the new gas tax will do to gas stations on border towns?
Not sure what you're getting at here, Bill with your question to me.
What do I think happened????.........I think you answered that???? ..the smokers voted with their feet........or should I say with their cars and drove to Cow Hmapshire to obtain cigs and bought beer while up there.
The enterprising individual amongst the tobacco afficiandos probably takes cig & beer orders from his pals & associates and wheels up Rte 12 or 31 to NH and makes himself a nice little killing for 3 hours work...altho I have to think there's more money in bringing back cigs than beer due to the bulkiness and weigh of beer.
Soon the enterprising person will proably be filling their gas tank while in Cow Hampshire, too.
One of these days, watch for a few high profile busts for trans-shipping cigs over state lines. Will be front page news in Boston Globe...but it wont stop it
Just an aside but this so called "Commonwealth Connector Health Plan" (which the cig tax is supposed to fund) is so God dam broke, it aint funny..........so what will they do now............raise the tax another dollar a pack? This is a classic case of Economics 101 when the black market kicks in. I know exactly how it works from my teen days when I used to sell the ocassional 16 pack of 1.5" firecrackers in high school...!!!!!!!!....we're talking 300-400% profit here with no taxes.....
Jahn (John) Dough (not Yan Dough)
Jahn:
very well said
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