Home » New Study Estimates Cigarette Smuggling Per State

New Study Estimates Cigarette Smuggling Per State

Last updated on March 30th, 2015 at 02:36 pm

New York holds the highest cigarette smuggling rate, and smuggling in Illinois has dramatically increased, according to a recent report from the Tax Foundation. Using the latest data from the Mackinac Center for Public Policy, the report details each state’s total inflow or outflow of smuggled cigarettes in 2013. The key findings include:

Smuggled cigarettes make up substantial portions of cigarette consumption in many states and greater than 20 percent of consumption in 15 states.

The highest inbound cigarette smuggling rates are in New York (58 percent), Arizona (49.3 percent), Washington (46.4 percent), New Mexico (46.1 percent) and Rhode Island (32 percent).

The highest outbound smuggling rates are in New Hampshire (28.6 percent), Idaho (24.2 percent), Virginia (22.6 percent), Delaware (22.6 percent) and Wyoming (21 percent).

Smuggling rates jumped substantially in Illinois after hikes in state and county excise tax rates, from 1.1 percent of consumption in the last edition to 20.9 percent in this edition.

Cigarette tax rates increased in 30 states and the District of Columbia between 2006 and 2013.

The study found New York is the highest net importer of smuggled cigarettes, totaling 58 percent of the total cigarette market in the state. New York also has the highest state cigarette tax ($4.35 per pack), not counting the additional local New York City cigarette tax (an additional $1.50 per pack). Smuggling in New York has risen sharply since 2006 (62 percent), as has the tax rate (190 percent).

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