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News Link • TAXES: State

Cigarette Taxes and Smuggling 2010: AZ #1!!!!

• MacKinac Center

Our new estimates indicate that in 2009, the state of Michigan ranked 10th in the nation* in smuggled cigarettes as a percentage of total in-state cigarette consumption — 26 percent. The five smuggling destination states with the highest cigarette smuggling rates were Arizona (51.8 percent of the state’s total consumption); New York (47.5 percent); Rhode Island (40.5 percent); New Mexico (37.2 percent); and California (36.3 percent).

According to our calculations, Arizona’s inbound smuggling rate was not in the top five in 2006, yet we estimate that Arizona now has the nation’s highest inbound cigarette smuggling rate, with over half of all cigarette consumption coming from smuggled sources. This is probably a function of the state’s 2006 excise tax hike, the 2009 federal excise tax hike and Arizona’s proximity to Mexico.


1 Comments in Response to

Comment by Joe Tittiger
Entered on:

Is it  self evident to anyone else that cigarette taxes should be at the same rate at everything else in the state?

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