Minnesota's House of Representatives Research on Cigarette Taxes
Some exerpts:
*Numerous states have recently increased their cigarette tax rates to balance their budgets or to fund program initiatives.*
*Settlements of the states' lawsuits against the tobacco companies have about the same economic effect as a cigarette tax, since these settlement payments are passed along to consumers (nationally) through higher cigarette prices. To compensate partially for the lower prices of nonsettlement cigarettes, the 2003 Minnesota Legislature imposed a 35-cent per pack "fee" on manufacturers who did not settle with the state. Michigan and Utah also impose a 35-cent surcharge on these cigarettes; Alaska imposes a 25-cent surcharge.*
*For fiscal year 2005, the Finance Department estimates collections from the two taxes will be about $182 million. Revenues from the tobacco products tax are deposited in the general fund. Revenues from 6.5 cents per pack of the cigarette tax go to fund the Academic Health Center, 2.5 cents to the medical education and research account, and the rest are deposited in the state general fund.*
Posted by change101
at 8:57 PM EST
